SPP interconnection procedures

----- Forwarded by Gloria Solis/HOU/ECT on 09/08/2000 03:49 PM -----

Christi L Nicolay
09/08/2000 02:06 PM

To: Gloria Solis/HOU/ECT@ECT
cc:
Subject: SPP interconnection procedures

Please forward to Steve Kean. Thanks.
---------------------- Forwarded by Christi L Nicolay/HOU/ECT on 09/08/2000
01:55 PM ---------------------------

From: Christi L Nicolay 09/08/2000 01:55 PM

To: Richard Shapiro/HOU/EES@EES, Raymond Bowen/HOU/ECT@ECT, Chip
Schneider/NA/Enron@Enron, Sarah Novosel/Corp/Enron@Enron, Joe
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cc:

Subject: SPP interconnection procedures

On 7/31/00, FERC approved SPP's interconnection procedures. Items of
interest:

Third party studies may be used upon mutual agreement between SPP and
Customer; however, SPP is not required to allow a third party contractor in
any instance that it cannot meet the time frames for study completion.
The current queued customer will bear the costs of completing a new study if
someone in the queue before it withdraws. (Dynegy asked that the withdrawing
customer should pay for any new studies required by others.)
While SPP is required to provide notice if the study will take more than 60
days, it is not bound to complete a study in 60 days (if more time is
reasonably needed.)
If transmission is not purchased, the customer is responsible for the costs
of upgrades that are needed "but for" the interconnection. However, once
transmission is requested, SPP is limited to charging the higher of (i) the
network upgrade expansion cost or (ii) an embedded cost rate which has the
expansion cost rolled-in. This is similar to pricing on pipelines.
Typically, Enron would not want to pay for network upgrades (as opposed to
the interconnection alone costs) without obtaining the transmission right on
OASIS. This order does advance the argument that network upgrades which
benefit the system (other customers) should be paid for in rates to all
customers.

Let me know if you would like a copy of the order.