Re: Southern RTO

From Christi Nicolay
---------------------- Forwarded by Linda J Noske/HOU/ECT on 07/05/2001 09:59
AM ---------------------------
From: Joe Connor@ENRON on 07/03/2001 10:29 PM
To: Donna Fulton/Corp/Enron@ENRON
cc: Christi L Nicolay/HOU/ECT@ECT, James D Steffes/NA/Enron@ENRON, Sarah
Novosel/Corp/Enron@ENRON

Subject: Re: Southern RTO

I would guess that AEC has had a change of heart - since they signed the MOU
with Southern. I would expect them to withdraw their comments. I will talk
to Jeff Parrish at AEC and find out what's going on.

I talked to Bob Reilley about the EPSA filing. He made it sound like it had
just been forgotten in the rush and he didn't seem to have a clear idea about
what EPSA should say in a filing. That's funny since he drafted the original
document we started talking from. Anyway, we discussed it again and he
agreed to get back to EPSA and discuss a filing. The topics would be:
(1) MOUs don't mean much
(2) No real progress has been shown
(3) FERC need to oversee the process
(4) FERC needs to ensure a collaborative process is implemented
I didn't tell Bob that Enron wants to stay out of it, but we talked about it
being better to have EPSA carry the ball when we first started looking at
this. I think your bringing it up in the EPSA phone call will help. Let me
know if it looks like Bob is not following up with EPSA.

Donna Fulton
07/03/2001 01:18 PM

To: Joe Connor/NA/Enron@Enron
cc: Christi L Nicolay/HOU/ECT@ECT, James D Steffes/NA/Enron@ENRON, Sarah
Novosel/Corp/Enron@ENRON
Subject: Re: Southern RTO

Joe, I agree with the approach that we should try to get EPSA to file. I
have spoken with Mark Bennett over at EPSA and he indicated that he hadn't
gotten to it. Perhaps I should bring it up on the EPSA call this Thursday,
just a gentle reminder.

AEC was the culprit who commented on June 22. They were extremely negative
about Southern's lack of results in their "attempt" to increase participation
in the RTO. They said, "Southern suggests no more than the possibility of
another paper 'RTO proposal' by December 15, 2001." They do ask for a
technical conference by FERC staff and then a settlement judge proceeding
thereafter.

Joe Connor
07/02/2001 11:43 AM

To: James D Steffes/NA/Enron@Enron, Christi L Nicolay/HOU/ECT@ECT, Sarah
Novosel/Corp/Enron@ENRON, Donna Fulton/Corp/Enron@ENRON
cc:
Subject: Re: Southern RTO

I met with Andy Dearman and Bill Newman of Southern on Friday. They talked
about what is going on with the non-jurisdictional utilities that have signed
a MOU to develop a RTO. The group has met a couple of times to discuss the
process they will use. Confidentiality agreements have been signed, so no
details are available, but they have agreed to a voting structure for the
development. Southern has about one third of the votes (and 65%of the
assets) and it takes at least two other parties agreeing with Southern to
carry a vote. Southern says they spent a lot of time convincing the other
parties that Southern was not going to run, or dominate, the process. After
that, Southern said the group started to pull together and get organized for
the development.

They said everyone in the group appeared to be ready to find ways to make the
RTO work and resolve the hurdles the non-jurisdictional utilities have been
expressing with the development of other RTOs. They said there were some
rough spots that had to be resolved and they couldn't be sure agreement would
be reached, but at this point there was a lot of cooperation.

Andy and Bill wanted to convince me that this was not a delaying tactic by
Southern and they were doing everything possible to ensure that a complete
RTO filing could be ready by 12/15/01. They also said they thought this is
what Ed Holland wanted to discuss with Steve Kean.

We talked about how other stakeholders could have input to the development.
They said that it was too early to make any commitment, but the group had
started thinking about it and they expected an input process to be available
by late summer.
They said Southern was in favor of some process that would provide
stakeholders the opportunity to look at what was being considered and advise
the development group as early as possible. They said they understood the
difficulty stakeholders had with the approach Southern used in its initial
filing and wanted to do it different, but they pointed out again that
Southern could not dictate the process that would be allowed by the group.
In the meantime, they said if we wanted to provide position papers on any
part of the RTO development they would make sure the papers were circulated
in the group or we could continue to hold bilateral discussions with them or
other members of the development group.

Jim, I still think it would be worthwhile to have a meeting between Ed and
Steve Kean, and I would include you and invite Andy and Bill to come. I
don't think they want to discuss anything technical at this point; they just
want to convince Enron that the approach Southern is taking provides the
quickest development of a RTO for the Southern area, and they want any help
we can give in convincing FERC to let this process run.

I also think we need to pass on filing a response to Southern's May 15th
status report, either alone or with Alabama Municipal Electric Authority (
Donna, I guess that's who you meant in the memo below, since AEC has signed a
MOU with Southern?). I will get in touch with Bob Reilley to find out why we
haven't heard from EPSA on its filing. I still think that's the best
approach.

Donna Fulton
06/28/2001 12:02 PM

To: Joe Connor/NA/Enron@Enron, Tom Chapman/HOU/ECT@ECT
cc: James D Steffes/NA/Enron@Enron, Christi L Nicolay/HOU/ECT@ECT, Sarah
Novosel/Corp/Enron@ENRON
Subject: Southern supplemental status report

I am attaching the supplemental status report that Southern filed in its
RT01-77 on June 20. They have included MOUs with Georgia Transmission Corp,
Santee Cooper and Alabama Electric Coop to work on development of an RTO.
These are really general, more of the same of what we've seen from Southern.

Also we had talked about possible comments on the May 15 Southern filing;
Coral was working on comments through EPSA. Nothing has been filed by EPSA
yet.

Alabama did file comments on the May 15 status report and they have asked
that the FERC establish a technical conference to "publicly air and evaluate
the alleged governance concerns and the concerns regarding significant
delay..." Following a technical conference, they ask for a judge to convene
a settlement conference at FERC to "undertake a properly supervised and
serious development of an RTO for the SE without further wasted time."

At this point we could consider filing comments in support of the Coop
comments.