Joe's group accomplishments in 2000 SO FAR!!

FYI
---------------------- Forwarded by Richard Shapiro/HOU/EES on 04/05/2000=
=20
01:50 PM ---------------------------
From: Christi L Nicolay@ECT on 04/05/2000 01:49 PM
To: James D Steffes/HOU/EES@EES, Richard Shapiro/HOU/EES@EES
cc: Joe Hartsoe/Corp/Enron@Enron, Sarah Novosel/Corp/Enron@Enron, Charles=
=20
Yeung/HOU/ECT@ECT, Richard Ingersoll/HOU/ECT@ECT=20
Subject: Joe's group accomplishments in 2000 SO FAR!!

Per Jim's request for the database. (I don't know if you want to put the=
=20
values that Kevin is giving into the database). =20

(1) Completed the negotiations and FERC filing of the Next Hour Market=20
scheduling proposal. When implemented, scheduled for June 2000, this will=
=20
provide one stop shopping for next hour business. Ties OASIS and TAGGING=
=20
together into one request. Also if a tranmission provider cuts the=20
transmission the PSE only pays for his actual use versus what he originally=
=20
scheduled. This will speed up the ability to schedule the next hour=20
non-firm. This order is an important recognition by FERC that its OATT did=
=20
not cover hourly, which we complained about alot at FERC's hotline last=20
summer.

2) Successful in obtaining the release of all ISN (system information) to=
=20
marketers in the WSCC region. This was an individual effort by Dick that h=
as=20
been benificial for our traders in the WEST. Successfully prevented the WS=
CC=20
Operating Committee from taking action that would have reversed this effort=
. =20

3) Assisted in getting the initial control areas in SERC approved last ye=
ar=20
and preventing ATC changes this year and OC changes that would have negated=
=20
the Control Area effort.

4) Dick served as Co CHAIR of the ISO committee that put the SPP contract=
=20
in place that eliminated MW mile pricing in SPP and will serve as the basis=
=20
for SPP's RTO. =20

5) Dick was appointed to the NERC Control Area Task Force which was formed=
=20
as a result of our the success of the Enron Control Areas in TVA and have s=
o=20
far been successful in keeping this effort so that it is non punitive. Thi=
s=20
has turned into a very positive process that may result in a new=20
configuration of the NERC relibiability effort.

(6) Dick's made comments to ENTERGY that helped push Entergy into filing=
=20
their new scheduling procedure (ultimate source and sink) with FERC. This=
=20
was initially going to be implemented unilaterally March 1 without a FERC=
=20
filing and Enron would have been forced into an after the fact complaint=20
situation at FERC where we are not allowed to get damages that we would hav=
e=20
incurred in the meantime (See Comm. Massey's concurrence in Aquila v. Enter=
gy=20
about the lack of incentive to file complaints). Kevin Presto said that=20
winning the protest at FERC (due 4/12) would be worth $100 MM.

(7) On 2/2, TECO revised its proposed generator imbalance charge from=20
minute by minute to hourly accountability (notably, TECO revised its propos=
al=20
before FERC issued an order based on the EPSA protest herein.) We worked wi=
th=20
EPSA to file an EPSA protest to TECO=01,s proposal. We didn=01,t like TECO=
's=20
proposal but had commercial concerns about filing a protest in our own name=
=20
(since Enron is working with TECO on a project). We were able to get EPSA=
=20
to protest this issue in TECO's initial filing. Enron is planning to site=
=20
generation in Florida, but we don't have the value on this win yet.

(8) FERC issued a NOPR on January 28 proposing to revise the=
=20
way it assesses annual charges to public utilities. Enron, along with=20
several other participants (Dynegy, Koch, APX, Citizens, NP Energy, Sonat a=
nd=20
Williams), filed a petition for rulemaking with FERC in August, 1998,=20
requesting FERC to revise its methodology for assessing annual charges,=20
arguing that FERC's current system of assessing annual charges on sales for=
=20
resale of power discourages trading, impedes reliance on competitive market=
s=20
for power, and could create competitive advantages for utilities over new=
=20
power marketers entering the market. We proposed that FERC either assess i=
ts=20
costs on transmission only, or reallocate the amounts that it collects=20
through sales transactions versus transmission transactions. Although FERC=
=20
does not grant our petition and in fact dismisses it as moot, the petition=
=20
served its purpose.

In the NOPR, FERC notes that because most of its time is spent on=20
transmission issues (a point that we made in the Petition), it is appropria=
te=20
to assess costs only on the MWh of electric energy transmitted in interstat=
e=20
commerce by public utilities. Under the current assessment system, FERC=20
divides its costs between transmission and sales. Now FERC is proposing to=
=20
collect its costs solely through transmission. FERC justifies this change=
=20
because it spends most of its time on transmission issues, and because=20
transmission providers can collect the fees through transmission charges=20
assessed to users of the grid. FERC proposes to asses its costs to 1)=20
unbundled wholesale transmission; 2) unbundled retail transmission; and 3)=
=20
bundled wholesale power sales. Bundled native load transactions will=20
apparently avoid assessments of any FERC-related costs; however, EPSA and=
=20
Enron are protesting this issue at FERC. (Jim Steffes has been working on =
a=20
calculation of additional value.)

(9) Interconnection Policy =01) Utilizing EPSA efforts, including Sarah's=
=20
meeting with FERC, we got the policy statement we urged FERC to put forth (=
in=20
the forum we suggested, i.e., an existing proceeding) in the Tennessee Powe=
r=20
order where FERC said interconnection procedures should follow the pro form=
a=20
tariff, including that a generator doesn't have to request transmission and=
=20
interconnection at the same time. We worked with EPSA to draft the "Model"=
=20
interconnection agreement that EPSA filed at FERC in the Entergy=20
interconnection proposal.

(10) AEP/CSW order =01) approved the merger but accepted intervenors=01,=
=20
testimony showing market power and conditioned merger on an independent=20
calculation of ATC postings (which we proposed) and independent market=20
monitor soon after the merger occurs with RTO participation by 12/15/01. =
=20
Kevin Presto said the independent ATC calculation is worth $20 MM to Enron.=
=20
(Note: we are going to propose MAIN instead of SPP, which AEP chose.). Kev=
in=20
said that AEP's ATC calculation can trump all interfaces in ECAR, so this h=
as=20
a positive effect not just on AEP, but on all of ECAR.

(11) MAPP =01) FERC further order on refunds. MAPP refused to refund moni=
es=20
that it was unable to collect from a non-jurisdictional member transmission=
=20
owner, NPPD. EPMI filed a protest to MAPP=01,s refund report, arguing that=
MAPP=20
was ordered to make full refunds and it violated that order. FERC agreed=
=20
with Enron and rejected MAPP=01,s refund report. FERC said MAPP must refun=
d the=20
full amount to transmission customers, whether or not it was able to collec=
t=20
that money from NPPD. Results in another $50,000 of refunds for EPMI.

(12) Sarah is working on the PGE sale.