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Enron Mail |
FERC issued an order today approving, with conditions, the merger between A=
EP=20 and CSW. EPMI was active in this proceeding, arguing that the merging=20 companies have transmission market power and that FERC should require the= =20 companies to mitigate that market power before approving the merger. EPMI= =20 proposed that the companies be required to form a TransCo before the merger= =20 could be approved. Although the Commission did not require the companies to form a TransCo=20 before approving the merger, the Commission did agree with many issues rais= ed=20 by EPMI and other intervenors, and the Commission adopted the testimony=20 submitted by Enron and two other intervenors on this issue of market power= =20 (rather than adopting the rebuttal testimony submitted by AEP where AEP=20 attempts to prove that it will not have market power after the merger). =20 Specifically, the Commission found that the merged entity will have market= =20 power, so it ordered the companies to join a FERC-approved RTO by the Order= =20 No. 2000 deadline (i.e., December 15, 2001). Under Order No. 2000, an RTO= =20 can be a TransCo, an ISO, or some hybrid of the two. =20 Furthermore, the Commission found that because the companies=01, market pow= er=20 will not be eliminated until the RTO is up and running, interim mitigation= =20 measures are also needed during the period prior to RTO membership. =20 Specifically, FERC requires the companies to turn over the duties of=20 calculating and posting ATC to an independent third party (a suggestion mad= e=20 by EPMI), and also directs AEP to provide generation dispatch information t= o=20 an independent market monitor in order to monitor AEP=01,s generation activ= ity. =20 The Commission orders AEP to respond to FERC within 15 days of whether AEP = is=20 prepared to accept these conditions. =20 We will continue to monitor this proceeding and we will notify you of any= =20 significant developments. Please call me if you have any questions.
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