What we would like Lay to get from Davis

Scott sent this to Marty, but I assume you already have had communications
with him about this.
----- Forwarded by Steven J Kean/NA/Enron on 01/02/2001 07:14 AM -----

Marty Sunde@EES
12/28/2000 07:05 PM

To: Steven J Kean/NA/Enron@Enron
cc:
Subject: What we would like Lay to get from Davis

In case you didn't see.
---------------------- Forwarded by Marty Sunde/HOU/EES on 12/28/2000 07:05
PM ---------------------------

Scott Stoness
12/27/2000 01:50 PM
To: Marty Sunde/HOU/EES@EES
cc:
Subject: What we would like Lay to get from Davis

Marty. This is a summary of our message from this morning for you to send on
or discuss with Keene. I hope this is helpful. Scott

What's important
Give solvency to the utilities by guaranteeing no banckruptcy against the
generation assets of the utilities. Guarantees to be recovered, if needed,
through surcharges over 10 years. This should give the process time for
thoughtful solutions. Ending the rate freeze now will give the utilities an
undeserved windfall (3.5b alone related to nuclear assets in year 2001).
There should be thoughtful process to determine: i) how to keep deregulation
going, ii) how existing generation assets should be used, iii) what are the
value of existing assets, iv) when is the appropriate time for customers to
be exposed to the market, and v) what kind of market structure would be
appropriate going forward.
Customers should not be dumped into the market, now or in the next year,
while it is extremely illiquid due to many errors of the utilities.
There should not be retroactive rate making (the negative ctc should be paid
until at least the rate freeze is ended)
All customers should be treated equally with respect to existing generation
assets that they paid for for the past 4-30 years.
There should be a special hearing called to debate demand side prospects (ie.
curtailment etc.)

From: Steven J Kean@ENRON on 12/26/2000 07:01 PM
To: Marty Sunde/HOU/EES@EES, Scott Stoness/HOU/EES@EES, Jeff
Dasovich/NA/Enron@Enron, Sandra McCubbin/NA/Enron@Enron, Paul
Kaufman/PDX/ECT@ECT, Richard Shapiro/NA/Enron@Enron, James D
Steffes/NA/Enron@Enron, Tim Belden/HOU/ECT@ECT, Phillip K Allen/HOU/ECT@ECT
cc:
Subject:

The Governor cancelled the meeting at the last minute. Apparently, he was
trying to schedule a meeting with Clinton and our meeting conflicted, so we
were bumped. We are trying to set a new time. I will share with the
Governor's energy advisor the information and recommendations all of you
helped put together. Thanks