RE: EES Market

Thanks Janine. Also, please keep Paul Kaufman and Jean Ryall in the loop. =
We need to make sure that we do this nationally. =20

Thanks.

Jim

-----Original Message-----
From: =09Migden, Janine =20
Sent:=09Thursday, October 11, 2001 10:48 AM
To:=09Kean, Steven J.; Shapiro, Richard; Steffes, James D.
Cc:=09Montovano, Steve
Subject:=09EES Market

I met with Jim Woods to discuss reviewing the states that are open and taki=
ng a targeted approach to most efficiently leverage our resources towards t=
earing down barriers in states where we have a significant market opportuni=
ty with a value proposition.

Steve, to your question the other day as to how much market opportunity the=
re is, what I gleaned from the meeting is that there are a number of opport=
unities that could take us through 2002, but after that it starts to dwindl=
e unless we can mine deeper in states where we have been active. However, =
the other interesting point is that EES does not have resources to necessar=
ily determine where the value proposition is and is looking to us to presen=
t to them what we think might be markets that will work for them. Thus, th=
ere may very well be more opportunities than they are currently focused on.=
As preliminary step, Steve Montovano and I had talked about getting a doc=
ument together that gives the high level summary of each state as a startin=
g point. Lynette Barnes has worked on such a document and Kathleen Sulliva=
n is going to work with her further and get a draft to Steve and I for revi=
ew and distribution to EES. Jim was very interested in seeing such a docum=
ent. Jim also noted that a state that has opportunities in the first year,=
may not in the second, but could reemerge in the third.

Jim, Jim Wood also mentioned that he had talked to you about a more coordin=
ated approach to EES and government affairs working together. Jim and I ar=
e going to exchange lists of who is assigned to which states and then put t=
ogether teams. Steve Montovano and I will work on identifying the governme=
nt affairs people for each state in our regions to give to Jim Woods.

It was agreed that over the next few weeks, I will put together a document =
that will try to preliminarily identify the states and more specifically th=
e utilities where there may be opportunities for EES based on a number of i=
ssues. The plan is to then share that with Jim Wood and then have a higher=
level meeting within EES to target where government affairs puts in its gr=
eatest efforts. Once I have a draft, I will share it internally for commen=
t before sending it on to Jim Woods.

Areas of interest to Jim were all of New England, Pennsylvania, New York an=
d Ohio. Illinois is emerging as one of their best markets and they are als=
o interested in looking real hard at Michigan. =20

With respect to Michigan, I met with the Michigan EES team and it appears t=
hat from a product development standpoint, they will be ready to go at the =
beginning of 2002, but the commodity desk is saying 2004 due to uncertainty=
on the RTO front, although they conceded that if progress is made, we coul=
d move the date up. There was also a discussion of doing financial deals i=
n Michigan for the first years until we are comfortable going physical.

I will keep you posted as this progresses, but I am optimistic that this co=
operative effort will lead to greater opportunities for EES.

Janine