UK P/L

Greg,
See note below for detail but here is the exec summary.

We had a couple of big shifts on the curves yesterday which I want you to be
aware of. We wanted to put several major adjustments through on the same
day. The main moves are as follows:

Increased gas volatility - we moved the curve up significantly for the first
several years. Lose o16mm
Power Peaks down, off-peaks up across the whole curve. Gain o10mm

Because "structured Derivatives" is a separate line item, this book loses
$43mm today, with power making approx $40mm to off-set. The $43mm may need
to be reported to Skilling, even though the real loss is just the gas loss of
o16mm.

(There were several other clear up items put through, but the above
represents the main issues to be aware of. Net on the day we are up, and
still expect to hit Q4 targets.).

Regards

Richard
---------------------- Forwarded by Richard Lewis/LON/ECT on 07/12/2000 11:49
---------------------------

James New
06/12/2000 18:18
To: John Sherriff/LON/ECT@ECT, Michael R Brown/LON/ECT@ECT, Richard
Lewis/LON/ECT@ECT
cc: Fernley Dyson/LON/ECT@ECT, Mike Jordan/LON/ECT@ECT, Buddy
Aiken/LON/ECT@ECT, Ingrid Morse/LON/ECT@ECT

Subject: UK Power Actual P&L results

We have now substantially calculated and confirmed the various line
adjustments we have been working on with commercial over the past few weeks.
The attached spread sheet shows the actual numbers (one number still to
determine finally) against forecast. The main changes were as a result of the
curves we used being a few days out of date and the front end of the live
curve having moved from the scenario curves. Dates are included for when the
P&L has been posted to the DPR. In addition to these numbers we booked a
profit of around o8.8m on the 30th of November relating to the Climate Change
Levy impact in the UK Power Energy Trends curve.

If you have any queries please let me know.

James