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Energy Issues | Firsst article attached refers to the 1946 Nebraska case I mentioned to you= =20 in DC | other | casual | 2 |
RE: ticket | Another question. What about a Continental flight to Amsterdam and from Amsterdam to Warsaw? I can also fly Continental through Rome or London as long as I don't have to change airports. Vince | personal & social | casual | 3 |
Re: CPUC Subpoena - Conference call TODAY! | I won't be on the call but will fax my comments to you this am Twanda Sweet@ECT 10/06/2000 09:51 AM To: Steven J Kean/NA/Enron@Enron James D Steffes/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Mary Hain/HOU/ECT@ECT Jeff Dasovich/NA/Enron@Enron msmith1@enron.com david_aamodt@pgn.com mday@gmssr.com Mark Palmer/Corp/Enron@ENRON Mark E Haedicke/HOU/ECT@ECT gfergus@brobeck.com cc: Subject: CPUC Subpoena - Conference call TODAY! Please be advised that there will be a conference call today at 11:30a.m. central standard time to discuss the draft response to CPUC. The dial in number is 800-998-2462 (passcode 4672956). If you have any questions please call me at 713-853-5587. Thanks. Richard Twanda Sweet Enron North America Corp. EB3821 (713) 853-9402 | energy infrastructure | formal | 5 |
<<Concur Expense Document>> - General Expenses | null | finance | neutral | 3 |
Request Confidential Information by FERC | We will be asking for confidential treatment unless and until the FERC requires similar information to be released by all market participants. ----------------- | energy infrastructure | formal | 3 |
Confidential Information and Securities Trading | To:CASH MICHELLE Email:michelle.cash@enron.com - 7138536401 Enron Wholesale Services - Office of the Chairman From: Mark Frevert Chairman & CEO Mark Haedicke Managing Director & General Counsel Subject: Confidential Information and Securities Trading To keep pace with the fluid and fast-changing demands of our equity trading activities Enron Wholesale Services (EWS) has recently revised its official Policies and Procedures Regarding Confidential Information and Securities Trading (Policies and Procedures). These revisions reflect two major developments: (1) our equity trading activities have been extended into the United Kingdom and (2) in an effort to streamline the information flow process the Review Team will play a more centralized role so that the role of the Resource Group is no longer necessary.You are required to become familiar with and to comply with the Policies and Procedures. The newly revised Policies and Procedures are available for your review on LegalOnline the new intranet website maintained by the Enron Wholesale Services Legal Department. Please click on the attached link to access LegalOnline: If you have already certified compliance with the Policies and Procedures during the 2001 calendar year you need not re-certify at this time although you are still required to to review and become familiar with the revised Policies and Procedures. If you have not certified compliance with the Policies and Procedures during the 2001 calendar year then you must do so within two weeks of your receipt of this message. The LegalOnline site will allow you to quickly and conveniently certify your compliance on-line with your SAP Personal ID number. If you have any questions concerning the Policies or Procedures please call Bob Bruce at extension 5-7780 or Donna Lowry at extension 3-1939. | legal affairs | formal | 3 |
Energy Issues | null | other | neutral | 0 |
Assoc PRC (4 Seasons) | Hartsoe: PJM HoganSPP WSCCHebertdemocratic nominee ACA Andy Rotherham AAE membership (703)875-0764 Gordon Weil page Maureen Joe Allen Dave Marquart Richard Tabors | government & politics | casual | 0 |
Privileged & Confidential -- Verification | null | other | neutral | 5 |
Fantastic Article in wash post on Refunds | - California Changes Stance on Refunds Two Sides Far Apart In Energy Talks By Peter Behr Washington Post Staff Writer Friday July 6 2001 Page E01 California officials have abruptly shifted tactics in their attempt to recover billions of dollars in alleged overcharges for electricity saying they may reduce their demands for huge refunds if generators renegotiate $43 billion in long-term electricity contracts that the state signed this year. Gov. Gray Davis (D) said part of the $8.9 billion in refunds the state is seeking could be offset by reductions in energy prices in the long-term contracts whose costs have become a growing political embarrassment for Davis. We've made suggestions we've offered various ways in which people could get us $8.9 billion Davis told the San Jose Mercury News in a report yesterday. You can renegotiate our existing contracts and save us money. However you want to do it it's just got to net out close to $8.9 billion. The new offer was introduced this week into the closed negotiations over a California settlement being conducted in Washington by Federal Energy Regulatory Commission Judge Curtis L. Wagner Jr. according to sources close to the negotiations. Yesterday Wagner said he may issue his own preliminary finding today on the amount of overcharges if California officials and the generators cannot reach a compromise. What I'm trying to do is get people in a settlement mood Wagner told reporters. In the event we're unable to do that [Friday] at some point I may offer a preliminary assessment. The settlement conference is set to conclude on Monday. Wagner FERC's chief administrative judge has been trying to push both sides toward a compromise that would resolve the huge energy pricing controversy. Mountainous energy prices have bankrupted California's largest utility drained billions of dollars out of the state treasury and put Davis at sword's point with generators that help keep the state's lights on. Last Friday Wagner rebuked Davis's chief representative Michael Kahn chairman of California Independent Grid Operator -- the state's power grid manager -- indicating that the state's demand for nearly $9 billion in refunds from power generators and marketers was too high sources said. Wagner's settlement conference which has involved more than 100 lawyers for all sides is closed to the public and media. Wagner complained last month that Kahn was following a political agenda and his lack of independence in the negotiations was such a joke that the parties might as well wear clown suits according to a Dow Jones report confirmed by sources close to the talks. But he has also criticized the generators and power marketers led by Reliant Energy Inc. Williams Energy Services Duke Energy and Southern Co. for failing to make serious settlement offers these sources said. The suppliers have offered to refund $600 million provided the state is able to call off various California lawsuits demanding far larger refunds sources said. Wagner's leverage is his ability to propose his own refund figure to FERC's commissioners. FERC has tentatively called for $124 million in refunds but now is taking a harder line on preventing a new escalation of California's electricity prices this summer and is likely to be receptive to a higher refund figure some energy analysts believe. Davis's tactical change offering to make the long-term contracts part of an overall settlement comes amid growing criticism of what the state will have to pay for energy under those deals. California's energy calamity stemmed in large part from its failed deregulation plan which relied heavily on short-term power purchases at volatile spot market prices. When energy costs shot upward last summer so did the state's electricity bills. In response Davis's aide S. David Freeman and his staff began negotiating long-term power contacts with suppliers. The $43 billion in deals signed so far would require the state to pay about $70 per hour for a megawatt of power for a large part of the electricity it will need over the next 10 years. That's well under the average of $250 per megawatt-hour that the state was paying at the beginning of this year but above current power prices -- and considerably higher than what electricity may cost in the next decade energy analysts say. A new agreement to lower those contract prices could relieve political pressure on Davis and focus settlement negotiations away from the state's controversial demand for the $8.9 billion refund. Davis will argue that reducing future power charges that his administration negotiated should count as a refund because the deals were reached under commercial duress according to sources close to Wagner's negotiations. Industry supporters say Davis's refund figure is impossible to justify. There's no benchmark for what a fair and reasonable price should be said Michael Zenger California director of Cambridge Energy Research Associates. The state's advocates counter that if FERC enforced a just and reasonable standard for power prices based on operating costs and a generous profit the overcharges by all sellers could easily reach the $9 billion figure. It's not rocket science but it does require the regulators to regulate said Frank Wolak a Stanford University economist who heads an oversight committee for the California grid. Those polar-opposite views have left both sides in Wagner's conference room billions of dollars apart as the talks approached their final weekend sources said. 2001 The Washington Post Company | other | informative | 3 |
Southeast RTO: Southerns Load | The Barton discussion draft says that FERC's hands would be tied and that they would have to approve a proposed RTO as to size and scope if the proposed RTO owns or has operational control over transmission facilities that serve at least 40000 MW of load. Southern's CEO testified in Congress recently that their load is over 35000. I assume the 40000 MW minimum would permit the SeTrans proposal to meet the proposed statutory minimum since it is Southern plus a few munis as I understand it. Is this correct? Who would know how many RTOs there would be if each were just over the 40000 MW minimum? I assume it is much more than 4-5 RTOs -- if so this is a good contrast to use in our Hill efforts. Thanks. | other | inquisitive | 3 |
Re: Confidential Attorney Client Privilege - Attorney Work Product | The letter looks fine. Eric H's letter was addressed to market participants. Can we get EPSA or WPTF to file this letter? Alan C. Mary Hain 01/25/2001 04:58 PM To: Christian Yoder/HOU/ECT@ECT steve.c.hall@enron.com Richard Sanders James D Steffes/NA/Enron@Enron Joe Hartsoe@Enron Sarah Novosel/Corp/Enron@ENRON James E Keller/HOU/EES@EES Mike D Smith/HOU/EES@EES Harry Kingerski/NA/Enron@Enron Dennis Benevides/HOU/EES@EES Tim Belden/HOU/ECT@ECT Robert Badeer/HOU/ECT@ECT Jeff Richter/HOU/ECT@ECT gfergus@brobeck.com Alan Comnes/PDX/ECT@ECT Richard Shapiro Roger Yang/SFO/EES@EES Greg Wolfe@ECT Chris H Foster/HOU/ECT@ECT Steven J Kean/NA/Enron@Enron Richard Shapiro cc: Subject: Confidential Attorney Client Privilege - Attorney Work Product I have drafted the attached letter denying the Cal ISO's request to send it (and the EOB) EPMI and EES' cost information for transactions over the FERC's cost cap. Since I believe we are on very firm ground my initial inclination was to send no response to the ISO's letter so there would be nothing to quote in the press. However I drafted this letter at Alan's suggestion for purposes of discussion. We should decide whether to send a letter before distributing this draft more widely in-house to discuss how to parse the message. | legal affairs | formal | 3 |
RE: Joao Neves | Rita I have postponed all the hiring decisions till late August - early September. We can revisit Joao's case at this point. We shall have better information about the space in the new building we can count on and the time of the move. We appreciate Joao interest in Enron. Vince Kaminski | other | formal | 2 |
Summary of Administration Comments on Bingaman Bill | I have read through the 19 pages of Administration comments on the Bingaman draft electricity bill released last month. Here are the main items in a quick bullet format so you have the flavor of them. Delete provision on federal jurisdiction over bundled/unbundled (they don't offer a reason). We of course agree for tactical reasons. Add a provision to authorize FERC to order wheeling in States that open retail markets. Add a provision to allow FERC to issue wheeling orders on its own motion based on an informal hearing rather than an adjudicatory hearing as under current law. Make it clear that the Federal Power Act does not affect the authority of a State to require retail competition (the comments say some utilities have tried to argue that the FPA prohibits states). The provision giving FERC power to order RTO participation should be deleted. The comments raise drafting question. The changes to the FERC merger review sections of the FPA should be limited. FERC lite should be extended only to state municipal utilities and cooperatives not the Federal utilities. The FERC should authority over the Federal transmission systems equivalent to FERC authority over public utilities (with special BPA rules). No need to legislate on market-based rates (we oppose the Bingaman language anyway so this is helpful). Interconnection language should be limited to transmission facilities not local distribution. No objection to streamlined reliability provision (this is good for us). Remedial measures for market power should be deleted. Administration to provide legislative language on federal transmission siting provisions which they want to retain. Not convinced there is a need for market transparency rules because FERC and DOE already have enough authority. Administration supports even tougher criminal penalties. Recordkeeping under PUHCA repeal should be clarified. Federal purchase requirement for renewable energy should be deleted. No objection to real-time pricing standard. Net metering should be limited to small residential renewable facilities. Do not support federal renewable portfolio standard (but could clarify state authority to adopt same). | other | formal | 3 |
Energy Issues | null | other | neutral | 0 |
RE: Invitation | Deniese Thanks for the invitation. I shall join you. Vince | personal & social | polite | 2 |
Enron Japan Office Opening Ceremony | I would like to do this but I have a speaking engagement the next day -- do the time zones work out so that I can do both or do I need to find a sub for the nov 1 speech? | other | casual | 3 |
FERC/SEC Update | please print | energy infrastructure | casual | 3 |
RE: Chairmans Speech | Re-read your reply. Just wondering what it means to possibly add a provision which I understand is a may -- dealing with FERC's authority to change existing RTOs. Depending on what that means it could seriously hamstring FERC's efforts for a 4-5 RTO model as sought and we support by not letting FERC change existing RTOs (particularly if that includes pending but not approved) to change. For example would the language under consideration block a Northeast RTO of PJM NY and NE since PJM is existing and NY has filed? What would be the rationale for such a serious limitation on FERC's authority? Thanks. | energy infrastructure | inquisitive | 5 |
Jeff on CNN | fyi -- further distribute this message as you see fit. ----------------- | media & press | casual | 2 |
Welcome New Associates - Reception | calendar ----------------- | other | friendly | 3 |
Industry News: Charges of Gouging as Power Costs Skyrocket | fyi ----------------- | other | neutral | 0 |
Re: CA Price caps | Oops. My computer sent the message before I was finished. I continue to hope that there is more opportunity than risk in this for us. Price volatility is in the news like never before and our main product is price risk management. I know that the inquiries are up I hope EES and ENA can get some sales out of it. More utilities have been approaching TNPC EES and ENA about taking over their merchant functions. On the policy side we are working the issue on both a state and federal level. Whether this country does anything meaningful to deal with the current crisis comes donw to one person ... Linda Breathitt. Ken Lay spoke with Secy Richardson and Sen Schumer about proposing rulemaking initiatives to FERC. We are working the RTO process hard elsewhere in the country and coming up with messages to arm our remaining allies around the country. THis is the biggest time for us on this issue since the very beginnings in California and New Hampshire. In the current panic however we will be decimated if we are associated only with a move to keep price caps from going into effect (I saw your message to Mona). I am going to read the comments next but I start off thinking we need to avoid running headlong into the price cap movement we may be better off trying to co-opt the movement to get broader reform. Hang in there. Susan J Mara 08/11/2000 11:56 AM To: Steven J Kean/HOU/EES@EES cc: Subject: CA Price caps I heard you've been raising a ruckus about our activities on the price caps -- asking us to do more. Thanks. I feel as if I have been a voice in the wilderness for the past six months when I was trying to get people to pay attention to the bad things happening in CA and warning that the problems (mainly a threat of reregulation) will spread elsewhere. | other | urgent | 5 |
Greetings from London | Hello Darrell I am in London this week looking among other things at our CreditDesk.com operation. I was trying to access your expert report from your web site but it's password protected. Can you send me a copy? Vince | other | polite | 3 |
Re: Confidential - Rob Stewart | Shanna I'm supportive of the raise to $150k. I think he is doing a good job and has a lot of value. He didn't fair well during the ranking due to lack of big $ or closure but maybe this will send him a good message. Thanks m | human resources | friendly | 2 |
null | I love you. Call me. | personal & social | casual | 0 |
Additional Lobbying Efforts | FYI. I think they should try to get in to see Lundquist but I don't think we need to participate in this. We have been focussed on nation-wide issues when we have had the opportunity to meet with Lundquist and I don't think we should use our limited shots here. ----------------- | external affairs | formal | 2 |
Ken Lay Mention At NRSC Reception Last Night | Last night I attended the National Republican Senatorial Committee's reception at Senator Frist's home in DC. (Frist is the NRSC chairman this cycle.) Enron including Jeff and Linda had been invited to the reception the purpose of which was to introduce ex-RNC chairman Haley Barbour as the NRSC's National Finance Chairman. Present were over a dozen Republican senators including Minority Leader Lott Whip Nickles and Sens. Kay Bailey Hutchison Bunning (KY) Fitzgerald (IL) Cochran (MS) Inhofe (OK) Bond (MO) Crapo (ID) Voinovich (OH) Allen (VA) and Chafee (RI). The news from our perspective is that Haley Barbour singled out Ken Lay for praise as the first person to step to the plate and agree to help with their new Majority Makers program. This is the effort that Barbour will head up to raise $21 million for this election cycle by concentrating on events outside DC that would target businesses and business leaders without a DC presence. Barbour said that Ken had agreed to organize and chair a Houston fundraiser to raise $1 million toward the $21 million total. Ken was the first name he mentioned. The only others were the DeVos family in Michigan and Julie Finley a major GOP fundraiser based in DC. Needless to say I was suddenly quite popular after Haley made his remarks to the assembled group. Haley said he looked forward to working with us on this project. As you know from a previous e-mail Pat Shortridge had earlier seen our mutual friend Mitch Bainwol the executive director of the NRSC who had told Pat at lunch last week that Haley had spoken with Ken but last night was the first I had heard a dollar figure -- and a big one at that -- linked to the effort. While it was not stated I assume from the location and size of the event's goal that the President would be involved (but this is only an educated assumption on my part). Later I saw Karen Hughes of the White House staff but I do not think she was present when Haley made his comments. | government & politics | casual | 3 |
Composition of unsecured creditors committee | ----------------- | finance | neutral | 3 |
RE: 1. London, June 28 - 29; 2. Houston, July 16 - 17 | Shirley No problem. Vince | other | casual | 0 |
RE: Hope youre staying dry! | Kate Not yet. I will know sometimes in August - September. Vince | personal & social | casual | 0 |
Op Ed satire | Can one of you forward to Ed or whoever you feel appropriate? ----------------- | other | casual | 2 |
null | Attached are my comments on the Bliley amendment to the Largent amendment. | legal affairs | formal | 3 |
null | Skilling will be speaking at the National Press Club next week. He'll give an overview of Enron's business talk about what's going on in power markets and what should be done to fix the current problems. California will get covered as well. Other than what we have already discussed is there anything Jeff should know or address in his remarks? | other | casual | 3 |
CAISO Notice - Congestion Reform Proposal - Apendix B | Market Participants: As part of the Congestion Management Reform Proposal the ISO has posted Appendix B Locational Price Dispersion Study on the ISO web site at . Please be aware that the file is very large (the Word version is 5.1 mb and the PDF version is somewhat smaller at 4.3 mb) so it will take a while to download. Byron Woertz Director Client Relations | energy infrastructure | formal | 3 |
Re: California Update 07.18.01 | These are useful updates. Please include Whalley Lavorato Parquet Dietrich Delainey Kitchens Haedicke Sanders Kirby Sharp Leff Calger Belden etc on future updates. Thanks From: Jeff Dasovich on 07/18/2001 08:18 PM Sent by: Jeff Dasovich To: Richard Shapiro/NA/Enron@Enron skean@enron.com Susan J Mara/NA/Enron@ENRON Harry Kingerski/Enron@EnronXGate James D Steffes/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Susan M Landwehr/Enron@EnronXGate mpalmer@enron.com Karen Denne/Enron@EnronXGate Janel Guerrero/Enron@EnronXGate Paul Kaufman/Enron@EnronXGate cc: Subject: California Update 07.18.01 The Senate the Assembly and the Governor are either poised to engage in very difficult negotiations or the three are about to crash and burn and Edison's going to be left dangling. In the Senate: The Senate bill 78XX is with about 90% likelihood going to be voted out of the Senate tonight---without a vote having taking place in any committee. Burton announced during one of the two informational hearings that this is it despite the view of just about everyone who appeared before the committees the bill likely won't prevent Edison from going bankrupt. The key features of the bill are: Banks and QFs get paid in full. Edison shareholders would be responsible for debts owed to suppliers No direct access. There are conflicting reports about whether the Senate will take up the bill tomorrow de-linking the bonds from the DWR contracts and whether the Republicans will go along with it. In the Assembly: The Committee is hearing the Wright and Hertzberg bills as we speak with Hertzberg's the likely winner. That bill now provides for Direct Access under certain conditions (the amendments describing the conditions were faxed today). We're attempting to get the July 12 date changed to the effective date of the bill or later. The Assembly likely won't vote the Hertzberg bill out until tomorrow at the earliest. The Problem: The Assembly and Senate bills are diametrically opposed in the way each approaches the problem---in short the bills are two ships passing in the night. The Democratic leaders (Governor Hertzberg Burton) aren't talking and Burton hasn't expressed any interest in talking---to anybody. The likely outcome given the circumstances: Burton says he's done what he needs to do (i.e. passed out a fair bill) the Assembly and Senate can't agree they finish the budget time runs out they leave Friday and Edison's left twisting. That said there's still a chance that the Governor could call Burton and sit down with Burton and Hertzberg and work something out by Friday or begin talking and postpone the recess until they get it worked out. But given Burton the chance of that happening seems very slim. In short little has changed since yesterday. Best Jeff | other | informative | 3 |
Fwd: Successful purchase of NBER Paper | Return-Path: <Gregory_Gordon@ssrn.com> Received: from rly-xd03.mx.aol.com (rly-xd03.mail.aol.com [172.20.105.168]) by air-xd05.mail.aol.com (v77.14) with ESMTP Sun 10 Dec 2000 10:57:06 -0500 Received: from zeus.ssrn.com (zeus.ssrn.com [38.202.236.235]) by rly-xd03.mx.aol.com (v77.27) with ESMTP Sun 10 Dec 2000 10:56:51 -0500 Received: from ssrn.com ([38.202.236.235]) by zeus.ssrn.com (Post.Office MTA v3.5.3 release 223 ID# 0-61092U100L2S100V35) with SMTP id com Sun 10 Dec 2000 10:56:50 -0500 Subject: Successful purchase of NBER Paper Date: Sun 10 Dec 2000 10:56:49 -0500 From: Gregory_Gordon@ssrn.com (Gregory_Gordon) To: <vkaminski@aol.com> CC: Message-ID: X-Mailer: Unknown Dear Wincenty Kaminski: Thank you for your purchase at Social Science Research Network. Your credit card has been charged $ 5.00. This charge will appear on your statement as Social Science Electronic Publishing our parent company. The confirmation number for this transaction is NBER_103397 and a summary of your order is below. If you have any questions about this charge please email Mailto:NBERSupport@ssrn.com for assistance. If you have any comments or suggestions about how SSRN can improve this service please let me know at Thank you Gregory Gordon President ORDER INFORMATION Diagnosing Market Power in California's Restructured Wholesale Electricity Market NBER Collection Borenstein / Bushnell / Wolak BILLING INFORMATION Wincenty Kaminski 1400 Smith Houston TX 77002 USA 713 853 3848 | other | formal | 0 |
RE: Ricardo Charvel | ----------------- | other | neutral | 0 |
FINAL | Attached is the final letter. Please note - there was a small change at the top of page 2. | business document | formal | 3 |
Supreme court brief | Good brief. I have noted a few comments and questions throughout the text. Ignore my universal change to the word transmissions. | legal affairs | formal | 2 |
Re: Senate Banking Hearing | Thanks Chris. Rick - see the witness list below in case you want to try to get some points through to these witnesses. Chris Long 09/25/2000 04:14 PM To: Steven J Kean/NA/Enron@Enron Joe Hillings/Corp/Enron@ENRON cc: Amy Fabian/Corp/Enron@ENRON Maureen McVicker/NA/Enron@Enron Cynthia Sandherr/Corp/Enron@ENRON Subject: Senate Banking Hearing Steve: I got the copy of the letter on independent auditor from Ken Lay to SEC Chairman Levitt. I suggest we transmit the letter to the Senate Banking Subcommittee on Securities in preparation for their hearing noted below. I will prepare a cover letter for transmission. Let me know if this acceptable. ----------------- | government & politics | formal | 3 |
CA load growth | null | other | neutral | 0 |
null | I just saw the NYT article. Nice job. It's nicely positioned as an issue about India's resolve to encourage foreign investment and live up to contracts. | media & press | formal | 0 |
<<Concur Expense Document>> - JB 002 | ----------------- | finance | formal | 3 |
null | Please send regrets | other | polite | 0 |
Energy Issues | Please see the following articles: Sac Bee Wed 7/11: Mediator talked of a bigger refund: He reportedly suggested a $4.5 billion deal midway through the failed talks Sac Bee Wed 7/11: Davis repeats threat to sue FERC to get full refund Sac Bee Wed 7/11: Dan Walters: Davis plays in a virtual world while the= =20 energy reality continues=20 Sac Bee Wed 7/11: Energy Digest: Ratepayer panel shot down again Sac Bee Wed 7/11: Missing megawatts: Conservation saving state from=20 blackouts (Editorial) SD Union Wed 7/11: Governor tells FERC to be fair and then some SD Union Wed 7/11: Calpine says deal with state close on alleged overchar= ges SD Union Wed 7/11: Judge refuses to let ratepayers form official committe= e=20 in utility bankruptcy case LA Times Wed 7/11: Judge Bars Ratepayers Panel From PG&E Case SF Chron Wed 7/11: Developments in California's energy crisis SF Chron Wed 7/11: Enron Corp. sues to block Senate from forcing document= =20 release SF Chron Wed 7/11: Governor threatens to sue utilities for refunds=20 Davis says California won't settle for $1 billion SF Chron Wed 7/11: News briefs on the California power crisis Mercury News Wed 7/11: White House bends under energy conservation pressu= re=20 Mercury News Wed 7/11: Davis ups the voltage (Editorial) OC Register Wed 7/11: Lights go out on Davis' power show (Commentary) --- Mediator talked of a bigger refund: He reportedly suggested a $4.5 billion= =20 deal midway through the failed talks. By David Whitney Bee Washington Bureau (Published July 11 2001)=20 WASHINGTON -- Midway through the negotiations between California and power= =20 sellers to settle the myriad issues arising out of the state's energy crisi= s=20 the mediator told California's negotiating team that he thought a deal wort= h=20 more than $4.5 billion would be appropriate -- a much higher figure than he= =20 suggested after the talks ended Monday.=20 Whether the statement by Curtis Wagner the chief administrative law judge= =20 for the Federal Energy Regulatory Commission was a negotiating ploy or a= =20 reflection of his evolving beliefs is not clear.=20 Before the settlement talks began two weeks earlier Wagner said he thought= =20 Gov. Gray Davis' demand for $8.9 billion in refunds was too high and that a= =20 settlement probably would be in the range of $2 billion to $2.5 billion.=20 The disclosure that Wagner had contemplated a much higher figure midway=20 through the negotiations suggests the state had more support than the judge= =20 let on Monday when he said after the talks foundered that he thought a deal= =20 should involve hundreds of millions maybe a billion dollars.=20 While the state wants $8.9 billion $3 billion of that was for overcharges= =20 during the five months preceding last October and are beyond FERC's scope o= f=20 review. Even as a starting point then the $4.5 billion mentioned by Wagner= =20 represented 75 percent of the money the state was demanding for alleged pri= ce=20 gouging between October and May.=20 The judge's $4.5 billion figure divided between cash payments and savings= =20 from long-term power contracts was confirmed by three sources who asked to= =20 be identified only as close to the negotiations because participants had= =20 been required to sign confidentiality statements.=20 The sources gave virtually identical accounts of a July 2 meeting with Wagn= er=20 in which the judge also dismissed as inadequate a $670 million settlement= =20 offer made by power generators and marketers.=20 By Monday the settlement offer had risen to $716 million. But the state=20 refused to back off its $8.9 billion demand and there never was any seriou= s=20 back-and-forth negotiations during the 15-day period the regulatory=20 commission had given Wagner to craft a deal.=20 As a consequence of the failed talks Wagner said Monday that within a week= =20 he will send the five-member commission his recommendations on how it might= =20 approach an order refunding power overcharges.=20 Among Wagner's suggestions is that the commission convene a hearing before = a=20 different administrative judge to take testimony from generators marketers= =20 and the state on how to arrive at a fair settlement.=20 The options sketchily outlined by Wagner on Monday included limiting the ti= me=20 when refunds are allowed -- something that could reduce state claims by abo= ut=20 one-third -- and changing the way power plant costs are calculated to a=20 formula more favored by generators.=20 It is not clear whether Wagner who moved from one negotiating team to=20 another during his two-week quest for a deal ever raised the $4.5 billion= =20 settlement figure to the power marketers and generators.=20 Joel Newton who represented Dynegy Power Duke Energy Reliant Energy=20 Williams-AES and Mirant in the talks said Tuesday he was bound by the=20 confidentiality pledge to keep silent on the internal negotiations.=20 Wagner also is refusing all media calls.=20 According to the account of the negotiations confirmed by sources Tuesday= =20 Wagner was angry at the snail's pace of progress after the first week of th= e=20 talks.=20 On Friday June 29 Wagner called everyone into his hearing room and scolde= d=20 them. He condemned the California team saying they all ought to wear clow= n=20 suits because they were in the pocket of Davis and refused to show any= =20 independence.=20 He then turned to the generators and said that after a week of talks nothi= ng=20 had been heard from them. He told them he wanted them to produce real=20 numbers and hard numbers over the weekend and that if they didn't he wou= ld=20 -- and you're not going to like it.=20 Wagner's admonition apparently moved no one toward a deal. On Monday in th= e=20 meeting with the California delegation one source quoted Wagner as saying= =20 the settlement number he received from the generators and marketers is so= =20 low I can't even present it to you.=20 I'm not happy with the figures they're not adequate others quoted the= =20 judge as saying.=20 At that point the sources said Wagner said he was thinking of a settlemen= t=20 of $2.5 billion in cash $2 billion in long-term contract savings and other= =20 money from out-of-state investor-owned utilities and even the federal=20 Bonneville Power Administration which markets power from dams in the=20 Northwest.=20 But as the clock wound down on the negotiations nothing much happened unti= l=20 Friday and Saturday when the California team met with the five largest pow= er=20 generators.=20 It was at those meetings that the generators offered $510 million in refund= s=20 to settle their disputes with the state. But the money would have gone to= =20 reduce the tab for what they were owed by the state and California utilitie= s=20 and it was loaded with conditions including the state dropping all of its= =20 investigations and lawsuits.=20 Wagner declared the talks over Monday saying he was unable to bring the=20 parties together.=20 The Bee's David Whitney can be reached at (202) 383-0004 or=20 dwhitney@mcclatchydc.com. Davis repeats threat to sue FERC to get full refund=20 By Emily Bazar Bee Capitol Bureau=20 (Published July 11 2001)=20 Gov. Gray Davis shot words of caution at federal regulators Tuesday warnin= g=20 that he will sue them if they order power companies to refund anything less= =20 than the $8.9 billion he and other state officials have demanded.=20 The Democratic governor also lobbed threats at state legislators suggestin= g=20 that he may call a special session to prevent them from embarking upon a=20 monthlong summer break next week.=20 Instead of vacationing Davis said lawmakers must work to approve an=20 agreement between the state and Southern California Edison that would save= =20 the utility from bankruptcy.=20 Though the governor has indicated previously that the state may take the=20 Federal Energy Regulatory Commission to court his announcement Tuesday mad= e=20 it clear he intends to follow through.=20 Settlement talks with power generators to determine how much if any the= =20 companies overcharged California for electricity concluded Monday with no= =20 resolution.=20 Now the decision rests with the FERC's governing board and Davis said the= =20 state won't back away from the $8.9 billion figure it demanded during talks= .=20 You order what you think is fair Davis said during a news conference wit= h=20 the state's top negotiators. We'll take what you order and we'll see you = in=20 court.=20 Davis acknowledged that a legal battle could drag out for months or years.= =20 He added that he believes the disagreement -- or even a protracted court=20 battle -- will not affect a tentative agreement between the state and Ediso= n.=20 Under terms of the deal money to pay off the utility's debt would come fro= m=20 a state purchase of its transmission lines and from a portion of consumers'= =20 electricity rates.=20 According to the agreement the Legislature must approve the deal by Aug. 1= 5=20 and Davis said he intends to hold lawmakers to that date.=20 Davis said the deadline is important because creditor committees will=20 scrutinize the Legislature's every move to determine whether to force Ediso= n=20 into bankruptcy court rather than await a political deal.=20 Legislators are scheduled to leave for summer recess July 20 and return Aug= .=20 20.=20 Davis threatened to use his executive powers to force lawmakers to remain i= n=20 Sacramento and work on the Edison agreement if necessary.=20 The Bee's Emily Bazar can be reached at (916) 326-5540 or ebazar@sacbee.com= . Dan Walters: Davis plays in a virtual world while the energy reality contin= ues (Published July 11 2001)=20 California still has a very real and very severe energy crisis to wit:=20 The state is still running up massive debts as it pays more for power than = it=20 can recover from ratepayers and is having trouble borrowing billions of=20 dollars to cover the debt.=20 There is a strong possibility perhaps a probability that when summer's he= at=20 truly descends there will be severe power blackouts as air conditioners=20 demand more juice than California can generate or buy.=20 One major utility Pacific Gas and Electric has filed for bankruptcy=20 protection and a second Southern California Edison is on the brink of=20 joining it.=20 There is however a virtual energy crisis consisting of political spin=20 media leaks and made-for-television buzz words -- and it is rapidly becomin= g=20 dominant while the real situation fades into the background.=20 This week's comic opera proceedings before a Federal Energy Regulatory=20 Commission administrative judge in Washington had little to do with reality= =20 and everything to do with the virtual version.=20 Gov. Gray Davis and other officials demanded $8.9 billion in refunds from t= he=20 generators and brokers who have been selling California power for the past= =20 year alleging that California is in Davis' words being gouged and rippe= d=20 off. But the number itself was more or less plucked out of thin air -- an= =20 arithmetic exercise by the state power grid's traffic controller not intend= ed=20 for a refund proceeding. And while Judge Curtis Wagner saw it as unrealisti= c=20 Davis and other state officials insisted on its validity.=20 There are refunds due that total hundreds of millions of dollars and maybe= a=20 billion dollars Wagner said as a final negotiating session collapsed. But= =20 that's a far cry from the $8.9 billion that Davis insists is due. If you= =20 think California is going to settle for $1 billion in refunds we will see= =20 you in court Davis said Tuesday.=20 Why is Davis being so belligerent? Because it's good politics. Ever since h= e=20 began berating out-of-state generators and accusing them of ripping off=20 California Davis' approval ratings have been climbing. If he settled for= =20 substantially less -- the power generators probably would agree to a couple= =20 of billion dollars to rid themselves of the matter -- Davis would be=20 embarrassed. Politically he's served by continuing to portray himself as= =20 fighting for California and against the out-of-state generators.=20 That it's more political construct than reality is indicated by another eve= nt=20 this week Davis' release of state power purchase data from early in the ye= ar=20 -- numbers that were made public only because a judge told him he had to do= =20 it.=20 Davis and his minions have been accusing Texas-based generators and power= =20 brokers of particularly egregious price gouging -- clearly playing on=20 Californians' instinctive mistrust of anything Texan and implying that Texa= n=20 George W. Bush is a co-conspirator. But the power purchase records -- which= =20 were released only to journalists willing to pay a stiff fee -- indicate th= at=20 less than 10 percent of California's power purchase dollars were going to= =20 Texas and the private sellers in general charged the state less than such= =20 publicly owned utilities as the Los Angeles Department of Water and Power.= =20 The clearly adverse position being taken by FERC and the purchase data that= =20 undercut his jingoistic sloganeering are not however deterring Davis from= =20 continuing to operate at least for public consumption in the melodramatic= =20 virtual world.=20 One cannot however ignore reality forever. The likelihood of a=20 pro-generator decision from FERC means that there will be no easy out for= =20 Davis or for his pending deal to prevent Southern California Edison from= =20 slipping into bankruptcy court. The Legislature has refused to act on the= =20 Edison rescue plan while it awaited an indication of whether the utility's= =20 debts would be slimmed down by FERC.=20 This week's farcical events make it more likely that the Edison deal will= =20 stall out permanently in the Legislature and its creditors will force the= =20 utility into bankruptcy court later this summer. That's part of that nasty= =20 old reality that cannot simply be wished away.=20 The Bee's Dan Walters can be reached at (916) 321-1195 or dwalters@sacbee.c= om . Energy Digest: Ratepayer panel shot down again (Published July 11 2001)=20 SAN FRANCISCO -- U.S. Bankruptcy Judge Dennis Montali on Tuesday reaffirmed= =20 his earlier decision to disband a ratepayers committee that would have give= n=20 consumers an official voice in the Pacific Gas and Electric Co. bankruptcy= =20 case.=20 The judge said bankruptcy court isn't the right forum for refunding rates o= r=20 settling potential future claims.=20 He eliminated erroneous statements from the opinion he originally issued=20 seven weeks ago. U.S. bankruptcy trustee Linda Ekstrom Stanley who had mov= ed=20 for reconsideration called the new version a very careful decision but d= id=20 not rule out an appeal.=20 Stanley on May 4 appointed an official committee of ratepayers to represent= =20 PG&E customers saying they might be forced to pay for the utility's massiv= e=20 losses.=20 --Claire Cooper Missing megawatts: Conservation saving state from blackouts (Published July 11 2001)=20 A public that doesn't believe that California's electricity crisis is genui= ne=20 is nonetheless acting as if it is. Experts are revising down scary=20 predictions of rolling blackout after rolling blackout as Californians have= =20 opted to conserve rather than consume.=20 During June Californians cut back on electricity use by roughly 4750=20 megawatts when it mattered the most on hot afternoons. Those decisions=20 shaved about 12 percent from the expected demand. That's equivalent to the= =20 output of nine or 10 medium-size power plants. Last June grid operators ha= d=20 to call six shortage alerts. This June which was hotter they called none.= =20 For a state that's been derided as selfish and wasteful that's nothing sho= rt=20 of amazing.=20 Some of what Californians are doing now to conserve isn't likely to become= =20 habit in the long run. Businesses may want to turn back on all the banks of= =20 lights. Homeowners may decide that 82 degrees is the right temperature when= =20 power is short but too warm when California's supply emergency is over.=20 Yet there's a huge potential payoff into the future if some of these change= s=20 become permanent. It's encouraging that the most effective forms of=20 conservation -- switching to more energy-efficient appliances or=20 manufacturing techniques -- have yet to be implemented on a large scale.=20 Subsidies for these programs have yet to translate into changes in business= es=20 and in homes that will lower demand even further.=20 For a while this spring some attempted to diminish the role of conservatio= n.=20 Conservation is a personal virtue said Vice President Dick Cheney. But= =20 Californians know it's become both a personal and public necessity. The=20 public may have thought the electricity shortage was an illusion but=20 everyone knew that the higher electricity bills that began arriving in June= =20 were real. And so was the risk that the lights would go out on hot days.=20 Yes the state needs more supply to catch up with the growth in demand. Yet= =20 long after the crisis is over there will be plenty of potential on the=20 efficiency side of the equation as well to protect the quality of life and= =20 reduce the high electricity costs that will likely plague the state for yea= rs. Governor tells FERC to be fair and then some=20 Davis firm on demand for $8.9 billion refund By Ed Mendel=20 UNION-TRIBUNE STAFF WRITER=20 July 11 2001=20 SACRAMENTO -- Gov. Gray Davis had a tough message for federal regulators=20 yesterday after the failure of settlement talks in California's bid to get = an=20 $8.9 billion refund from electricity suppliers: See you in court.=20 The governor said California will seek a full $8.9 billion refund for=20 electricity overcharges even if federal regulators award the maximum refun= d=20 of $5.4 billion allowed under their guidelines.=20 Our message is just order what you are going to order Davis said of the= =20 Federal Energy Regulatory Commission. We believe you should order $8.9=20 billion. But you order what you think is fair. We will take what you order= =20 then we will see you in court.=20 Davis joined by his negotiating team made the remarks at a news conferenc= e=20 a day after two weeks of closed-door talks with suppliers in Washington=20 failed to reach an agreement.=20 An administrative law judge made a recommendation to the regulatory=20 commission that Davis' top negotiator Michael Kahn chairman of the=20 California Independent System Operator expects to result in a refund of mo= re=20 than $1 billion.=20 Davis said that a revealing decision will be made by the commission which = he=20 hopes has embarked on a new path with the appointment by President Bush o= f=20 two new members Pat Wood of Texas and Nora Brownell of Pennsylvania.=20 Are they on the side of consumers as the federal power act envisions them= =20 being Davis asked or are they just there to do the industry's bidding = as=20 they have so often in the past?=20 Kahn said rules adopted by FERC cut off the refund period at last October= =20 trimming $3 billion from the $8.9 billion overcharge claimed by California= =20 dating to May 2000.=20 He said FERC has no jurisdiction over municipal utilities such as the Los= =20 Angeles Department of Water and Power that sold power to the state. The=20 municipal districts overcharged the state by about $600 million according = to=20 Kahn.=20 As a result he said the maximum refund that FERC could order for Californ= ia=20 is about $5.4 billion.=20 We made it clear to everyone that if we did not settle for $8.9 billion w= e=20 would seek redress in court for the remainder of the money above $5.4=20 billion Kahn said.=20 Calpine of San Jose and several other generators have expressed interest in= =20 the state's offer to negotiate one-on-one with the state while the federal= =20 regulators consider their decision Kahn said. Calpine says deal with state close on alleged overcharges=20 By Don Thompson ASSOCIATED PRESS=20 July 10 2001=20 SACRAMENTO =01) Calpine Corp. said Tuesday it is near agreement with Califo= rnia=20 officials over money the state says the company overcharged for electricity= .=20 That would make it the first company to settle a part of the $8.9 billion t= he=20 state wants in negotiations before the Federal Energy Regulatory Commission= .=20 However San Jose-based Calpine has offered far less than the $236 million= =20 the state claims it is owed.=20 We obviously disagree with that number because we disagree with some of t= he=20 assumptions used for the estimate said Calpine spokesman Bill Highlander.= =20 We don't think it's anywhere near that. We think it's a low number.=20 He wouldn't specify the company's counteroffer but noted new FERC figures= =20 showing the company did $29 million in business with the state in the first= =20 five months of this year.=20 The California Independent System Operator estimated the company owed more = in=20 overcharges than it had in total sales for the period from May 2000 to May= =20 2001 a financial impossibility Highlander said.=20 The ISO essentially multiplied what Calpine was able to produce by the amou= nt=20 it charged for electricity Highlander said without taking into account ho= w=20 much electricity the company actually sold.=20 ISO spokesman Michael Bustamante defended the projections by the state's gr= id=20 operator estimates he said were validated during two weeks of FERC=20 negotiations that ended Monday. The ISO took the methodology adopted by the= =20 federal regulator in a June 19 order capping electricity rates then worked= =20 backward to May 2000 to reach its estimate Bustamante said.=20 Generators and state negotiators were unable to reach a settlement during t= he=20 two weeks of talks overseen by FERC chief administrative law judge Curtis L= .=20 Wagner leaving Wagner to make his own recommendation to the commission.=20 Wagner said Monday the state may be owed perhaps $1 billion in overcharges= =20 but said that could be offset by money the generators are owed for the powe= r=20 they sold into the state.=20 California officials believe generators owe about $4 billion in refunds usi= ng=20 the June 19 order that Wagner adopted as his benchmark even given Wagner's= =20 determination that the commission can only consider overcharges after Oct. = 2.=20 At one point during negotiations Wagner told California officials he thoug= ht=20 an appropriate settlement should top $4.5 billion according to one=20 negotiator who spoke on condition he not be named. Wagner suggested=20 generators could pay $2.5 billion in cash and $2 billion in long-term=20 electricity contracts at cheaper rates the source said.=20 That was very different from the $670 million in refunds Wagner privately= =20 said generators were offering. For instance the source said while Reliant= =20 Energy on Monday offered $50 million in refunds California believes=20 Reliant's share of overcharges is closer to $1 billion.=20 Jan Smutny-Jones executive director of the Independent Energy Producers= =20 applauded the possibility that some generators will settle with the state= =20 without waiting for a FERC decision and likely protracted court battle.=20 We need to solve this problem and move on Smutny-Jones said.=20 ?? =01) Associated Press writer Mark Sherman contributed to this story from=20 Washington D.C.=20 Judge refuses to let ratepayers form official committee in utility bankrupt= cy=20 case=20 ASSOCIATED PRESS=20 July 10 2001=20 SAN FRANCISCO =01) The federal judge overseeing Pacific Gas and Electric Co= .'s=20 bankruptcy case ruled Tuesday the utility's ratepayers cannot form an=20 official committee to represent their interests.=20 Ratepayer advocates had sought such recognition to ensure the utility would= =20 not raise rates further as a way of paying off its debts.=20 But U.S. Bankruptcy Judge Dennis Montali agreed with PG&E and the official= =20 creditors committee and rejected the idea for the second time in two months= .=20 Montali suggested instead that ratepayers organize an informal committee to= =20 bring their concerns to the court and said the ratepayers also could bring= =20 matters before the state Public Utilities Commission.=20 A separate committee of ratepayers would have been able to vote on the fina= l=20 reorganization of the company a plan that could affect power service and= =20 rates.=20 PG&E filed for Chapter 11 bankruptcy April 6 and owes billions of dollars = to=20 more than 50000 creditors. It was brought down in part by California's= =20 botched experiment with deregulation.=20 Judge Bars Ratepayers Panel From PG&E Case Power: Customers are not creditors in the utility's bankruptcy ruling says= .=20 Action does not preclude refunds for consumers. TIM REITERMAN TIMES STAFF WRITER July 11 2001 SAN FRANCISCO -- A federal judge Tuesday reaffirmed his decision to bar a= =20 ratepayers committee from Pacific Gas & Electric Co.'s bankruptcy case and= =20 denounced the committee's attorney for suggesting that the action could=20 prevent PG&E customers from receiving refunds for excessive energy charges. Judge Dennis Montali ruled against a U.S. trustee and the ratepayers=20 committee in deciding that ratepayers as a group had no claims and were not= =20 creditors when PG&E filed for bankruptcy on April 6. But Montali criticized misguided remarks by a committee attorney on July = 5=20 and news media accounts that followed the hearing. The judge said the repor= ts=20 left the misconception that by disallowing a ratepayers committee he would= =20 reject all claims of ratepayers and they could lose out on future refunds. The judge and PG&E officials emphasized that there are no matters involving= =20 PG&E customer refunds before the state Public Utilities Commission. State officials are seeking about $9 billion in refunds however from the= =20 Federal Energy Regulatory Commission for alleged overcharges to Californian= s=20 by energy companies since last year. The distribution of any ratepayer refunds would be decided by the PUC and= =20 customers would be paid whether or not they filed Bankruptcy Court claims b= y=20 a Sept. 5 deadline the judge and PG&E attorneys said. The judge took the highly unusual step of directing PG&E and U.S. Trustee= =20 Linda Ekstrom Stanley to consider remedies to allay any confusion among=20 PG&E's 5.5 million customers. He suggested publishing clarifications in newspapers that carried the=20 erroneous information in PG&E customer bills and on Web sites. Stanley had formed a ratepayers committee of business government and=20 consumer representatives saying they will be affected by PG&E's Chapter 11= =20 reorganization. But Montali decided that ratepayers do not qualify as creditors under=20 bankruptcy law and are not entitled to official status that allows them to= =20 participate in the bankruptcy and receive funding from PG&E. Stanley said she has not yet decided whether to appeal the ruling to federa= l=20 district court.=20 Copyright 2001 Los Angeles Times=20 Developments in California's energy crisis=20 The Associated Press Wednesday July 11 2001=20 2001 Associated Press=20 URL:=20 tate1 036EDT0129.DTL=20 (07-11) 07:36 PDT (AP) --=20 Developments in California's energy crisis:=20 WEDNESDAY=3D * No power alerts Wednesday as electricity reserves stay above 7 percent.= =20 TUESDAY=3D * U.S. Bankruptcy Judge Dennis Montali again agreed with PG&E and the=20 official creditors committee saying such a committee of Pacific Gas and=20 Electric Co. ratepayers has no legal standing in bankruptcy court. Ratepaye= r=20 advocates had sought the recognition to ensure the utility would not raise= =20 rates further as a way of paying off its debts.=20 * PG&E has agreed to pay $4.1 million in tax penalties to 49 counties where= =20 the utility owns property. The utility already paid $41.2 million in overdu= e=20 property taxes in May -- the additional amount covers a 10 percent fee for= =20 paying those taxes late.=20 * Calpine Corporation says it is near agreement with California officials= =20 over money the state says the company overcharged for electricity. That wou= ld=20 make it the first company to settle a portion of the $8.9 billion dollars t= he=20 state is seeking in proceedings before the Federal Energy Regulatory=20 Commission. But the San Jose-based company is offering much less than the= =20 $236 million dollars the state claims it is owed.=20 * No power alerts Tuesday as electricity reserves stay above 7 percent.=20 * Shares of Edison International closed at $14.05 up 5 cents. PG&E Corp.= =20 drop 55 cents to close at $13.55. Sempra Energy the parent company of San= =20 Diego Gas & Electric Co. closed at $27.67 up 15 cents.=20 WHAT'S NEXT=3D * The Senate committee investigating possible price manipulation in=20 California's energy market meets Wednesday. The committee will vote on=20 contempt citations against generators Mirant and Enron which failed to=20 comply with subpoenas for documents. The committee will meet again July 18 = to=20 consider compliance by six other suppliers that have until Tuesday to turn= =20 over documents.=20 THE PROBLEM: High demand high wholesale energy costs transmission glitches and a tight= =20 supply worsened by scarce hydroelectric power in the Northwest and=20 maintenance at aging California power plants are all factors in California'= s=20 electricity crisis.=20 Southern California Edison and Pacific Gas and Electric say they've lost=20 nearly $14 billion since June 2000 to high wholesale prices the state's=20 electricity deregulation law bars them from passing on to consumers. PG&E= =20 saying it hasn't received the help it needs from regulators or state=20 lawmakers filed for federal bankruptcy protection April 6. Electricity and= =20 natural gas suppliers scared off by the companies' poor credit ratings ar= e=20 refusing to sell to them leading the state in January to start buying powe= r=20 for the utilities' nearly 9 million residential and business customers. The= =20 state is also buying power for a third investor-owned utility San Diego Ga= s=20 & Electric which is in better financial shape than much larger Edison and= =20 PG&E but is also struggling with high wholesale power costs.=20 The Public Utilities Commission has approved average rate increases of 37= =20 percent for the heaviest residential customers and 38 percent for commercia= l=20 customers and hikes of up to 49 percent for industrial customers and 15=20 percent or 20 percent for agricultural customers to help finance the state'= s=20 multibillion-dollar power buys.=20 Track the state's blackout warnings on the Web at=20 2001 Associated Press ?=20 Enron Corp. sues to block Senate from forcing document release=20 DON THOMPSON Associated Press Writer Wednesday July 11 2001=20 2001 Associated Press=20 URL:=20 tate1 212EDT0141.DTL=20 (07-11) 09:12 PDT SACRAMENTO (AP) --=20 Enron Corp. is suing state officials to stop a Senate subpoena of its=20 financial records in a dispute over alleged overcharges for its electricity= =20 sales to California.=20 They've sent two things to Texas -- our money and these documents and the= y=20 saying we can't get either one back said Laurence Drivon special legal= =20 counsel to the Senate Select Committee to Investigate Market Manipulation.= =20 The suit came hours before the committee will consider asking the full Sena= te=20 to cite the Houston-based company for contempt Wednesday. The other subject= =20 of possible sanctions Atlanta-based Mirant Inc. appears to be cooperating= =20 Drivon said.=20 Committee chairman Joe Dunn a Santa Ana Democrat said the committee's=20 investigation will continue despite Enron's pure act of intimidation. We'r= e=20 not going to back down.=20 Enron's suit said the company's financial papers are outside the committee'= s=20 jurisdiction because most of its operations and paperwork are outside=20 California.=20 That shouldn't matter Drivon said citing last year's successful of=20 out-of-state documents during the investigation into the activities of form= er=20 Insurance Commissioner Chuck Quackenbush. Previous investigations have=20 included documents subpoenaed from other nations he said.=20 Companies doing business in California cannot claim immunity from its laws = or=20 oversight Drivon and Dunn said. Houston-based Reliant Energy made the same= =20 argument but then agreed to turn over 1800 documents.=20 2001 Associated Press ?=20 Governor threatens to sue utilities for refunds=20 Davis says California won't settle for $1 billion=20 Mark Martin Chronicle Staff Writer Wednesday July 11 2001=20 2001 San Francisco Chronicle=20 URL:=20 /11/M N139275.DTL=20 Sacramento -- One day after a federal judge rebuked California's claim that= =20 energy generators owe the state $8.9 billion Gov. Gray Davis all but vowed= =20 to sue the companies to recoup the money.=20 If you think California will settle for $1 billion in refunds we'll see y= ou=20 in court Davis said yesterday.=20 Continuing his heated rhetoric on the energy crisis Davis blasted the ener= gy=20 companies for being inflexible during a 14-day negotiation session in=20 Washington D.C. that ended Monday. Both the state and power generators=20 argue each is owed money as a result of California's dysfunctional=20 electricity market.=20 Federal Energy Regulatory Commission chief administrative law Judge Curtis = L.=20 Wagner ended the talks by saying the state was owed far less than it claime= d=20 but the FERC's governing board will make a final decision on who owes what = to=20 whom in the coming months.=20 Yesterday Davis made it clear he wouldn't accept a FERC decision that=20 strayed far from the state's calculations that power companies overcharged= =20 California nearly $9 billion.=20 The ball is in the FERC's court he said. They must step up and provide= =20 the refunds we've asked for.=20 While Davis said California officials had gone to Washington prepared to=20 discuss ways to reach a settlement including renegotiating long-term=20 contracts to buy power an energy industry official faulted the state for i= ts=20 unwillingness to compromise.=20 Generators put forward an offer even though they believe no refunds are owe= d=20 said Jan Smutny-Jones executive director of the Independent Energy=20 Producers.=20 Smutny-Jones said the state needed to stop thinking it would get the $8.9= =20 billion.=20 It's clear from the way the issue was characterized by the judge that $9= =20 billion is not something the state is going to see any time in the near=20 future he added. It is not based in reality.=20 Davis also took heat from Republicans yesterday.=20 He desperately needs that refund so he can renegotiate the dreadful=20 contracts he has entered into said Rob Stutzman a consultant for the=20 California Republican Party. He's sitting at the poker table with very few= =20 chips.=20 In other energy news yesterday a judge refused to let a committee represen= t=20 the public in the Pacific Gas & Electric Co. bankruptcy case and said a=20 consumer lawyer's irresponsible position at a hearing last week could=20 mislead PG&E customers into filing needless refund claims with the court.= =20 U.S. Bankruptcy Judge Dennis Montali said any refunds owed to customers wer= e=20 unrelated to the bankruptcy case and would be determined by regulators.=20 At the hearing Thursday attorney KaarenThomas argued that unless a committ= ee=20 represented customers' interests PG&E could try to bar all refund claims= =20 that weren't filed by Sept. 5.=20 Montali ruled in May that the committee was not authorized by federal=20 bankruptcy law and reaffirmed his ruling yesterday.=20 Chronicle staff writers Lynda Gledhill and Robert Egelko contributed to thi= s=20 report.=20 E-mail Mark Martin at 2001 San Francisco Chronicle ? Page?A - 3=20 News briefs on the California power crisis=20 The Associated Press Wednesday July 11 2001=20 2001 Associated Press=20 URL:=20 tate0 738EDT0118.DTL=20 (07-11) 04:38 PDT SAN JOSE Calif. (AP) --=20 Energy supplier Calpine Corp. has reached a deal to purchase 236 billion=20 cubic feet of natural gas in Texas and New Mexico for $355 million plus=20 assumption of nearly $50 million of debt.=20 Company officials made the announcement Tuesday and said the purchase will= =20 increase its natural gas reserves.=20 This transaction meets our desire to own and operate production in a=20 strategic basin said Cathy Piece Calpine's director of land and=20 acquisitions. These assets significantly strengthen our reserve base and= =20 will help fuel our growing Western power program.=20 The San Jose-based company has agreed to purchase 35 wells in New Mexico th= at=20 produce 6 million cubic feet of gas per day from The Bayless Companies. The= =20 second transaction involves the acquisition of a majority interest of Micha= el=20 Petroleum of Houston. The Texas company produces about 43 million cubic fee= t=20 of gas per day.=20 Calpine officials said the agreements will allow them to meet their future= =20 capacity demands for both natural gas and electricity. The company wants to= =20 generate more than 70000 megawatts of electricity by the end of 2005 and= =20 have natural gas reserves of 6.7 trillion cubic feet.=20 LOS ANGELES (AP) -- Newly elected Mayor James Hahn has postponed selling th= e=20 city's surplus power to the state so he can examine how it will impact=20 ratepayers.=20 Hahn's predecessor Richard Riordan said last month the city's Department = of=20 Water and Power would sell its extra electricity -- about 500 megawatts a= =20 day_ to the state at cost between July and September.=20 The contract was supposed to have been signed last week.=20 Steve Maviglio a spokesman for Gov. Gray Davis said Tuesday that the stat= e=20 is ready to sign the contract.=20 We're ready to sign he said. Like most negotiations that aren't final= =20 things go back and forth. The new (Hahn) administration wants to review the= =20 document before it.=20 Davis had threatened to seize surplus power from municipal utilities which= =20 haven't been subjected to the California energy crisis because he claimed= =20 they were gouging the state.=20 TEMECULA Calif. (AP) -- State officials said they are studying alternative= =20 routes for a power transmission line proposed by San Diego Gas and Electric= =20 Co.=20 The utility wants to run a 500000-volt power line through southwestern=20 Riverside County connecting its power grid with Southern California Edison'= s.=20 The cost of the project is estimated at $271 million and must be approved b= y=20 the state's Public Utilities Commission.=20 But state officials listed alternative routes in papers released at a publi= c=20 hearing Tuesday. Some of the other ideas include putting the transmission= =20 line around the edges of an Indian reservation or running a route through t= he=20 Cleveland National Forest.=20 Once a final selection is made the information will be given to PUC=20 commissioners who will either approve or deny the project.=20 Many residents who live in the path of the proposed transmission line don't= =20 want the project. An attorney representing several groups that oppose SDG&E= 's=20 plans said there was no mention of alternative routes in environmental=20 documents submitted by the company.=20 Looking at the various route segments offered by SDG&E as alternatives is= =20 like trying to arrange the deck chairs on the Titanic said attorney Mark= =20 Mihaly.=20 2001 Associated Press ?=20 White House bends under energy conservation pressure=20 Posted at 6:25 a.m. PDT Wednesday July 11 2001=20 BY H. JOSEF HEBERT=20 Associated Press Writer=20 WASHINGTON (AP) -- Under pressure to include more conservation measures tha= t=20 reduce energy use congressional Republicans are moving toward a compromise= =20 to increase fuel efficiency requirements for sport utility vehicles as part= =20 of an energy package.=20 Key House GOP lawmakers said Tuesday they expect some increase in fuel=20 economy requirements especially for SUVs in energy legislation working it= s=20 way through the House. Democrats who have a majority in the Senate also= =20 favor requiring improved motor vehicle fuel efficiency.=20 At the same time the Bush administration signaled its willingness Tuesday = to=20 begin a rule-changing process that would allow the first increase in 25 yea= rs=20 in the federal corporate automobile fuel economy or CAFE standard.=20 Transportation Secretary Norman Mineta asked Congress to lift immediately a= =20 six-year prohibition that bans the department from consideration of fuel=20 economy increases. Lawmakers already agreed this year not to extend the ban= =20 beyond September but Mineta said he wants to start examining possible=20 changes right away.=20 CAFE standards which mandate fuel economy requirements for vehicle fleets= =20 have not been increased since their introduction in 1975. That year's law= =20 spurred by energy shortages in the early 1970s required passengers cars to= =20 meet a fleet average of at least 27.5 miles per gallon. Light trucks -- a= =20 category that includes SUVs vans and pickups -- have to meet a 20.7 mpg=20 fleet average.=20 With the widespread popularity of SUVs and vans in recent years many=20 environmentalists have argued that the lower truck standard has compromised= =20 the intent of the 1975 law. SUVs and vans comprise more than 40 percent of= =20 the passenger vehicles on the road today.=20 As three committees began crafting energy legislation lawmakers were=20 searching for a bipartisan compromise to increase fuel economy requirements= =20 for motor vehicles. Some increase in the CAFE requirement was virtually=20 assured several GOP lawmakers said although disagreements remain on how= =20 much of an increase whether it should apply to automobiles as well as SUVs= =20 vans and small trucks and the timetable for phasing in new requirements.= =20 Energy legislation that the House Energy and Commerce Committee was taking = up=20 later Wednesday contains no fuel economy provision.=20 But Rep. Billy Tauzin R-La. the committee chairman said discussions were= =20 under way to work out a compromise on a fuel economy proposal. He said he= =20 expects an amendment on CAFE to be added to the bill either during=20 deliberations in his committee or on the House floor.=20 Rep. Joe Barton R-Texas chairman of the subcommittee drafting the energy= =20 package saw a good chance the truck standards will be raised and said the= =20 automobile standard might be increased as well. Other GOP sources who talke= d=20 about the private discussions on condition of not being identified by name= =20 said a likely outcome is that the truck standard will be increased three or= =20 four mpg and the auto standard left alone.=20 Momentum for some CAFE increase has been growing in recent weeks as GOP=20 lawmakers came under increasing pressure to come up with additional=20 conservation proposals to those proposed in the White House's energy policy= .=20 It largely focuses on production with few specific measures to dramaticall= y=20 curb energy demand.=20 Democrats have pressed for tougher automobile fuel economy standards.=20 Automakers have fought attempts to increase the standards. They say such=20 government edicts limit consumer choice and force manufacturers to build=20 smaller cars that customers don't want. Supporters of increased fuel econom= y=20 argue that new technologies are available to increase fuel efficiency witho= ut=20 decreasing vehicle size.=20 President Bush's energy blueprint would consider CAFE increases but not=20 before a National Academy of Sciences report is issued probably this month= =20 on impact of the standard on energy savings safety and auto industry=20 competition. Davis ups the voltage=20 Published Wednesday July 11 2001 in the San Jose Mercury News=20 Vow to sue for refunds may be a bluff but he should keep pushing FERC=20 THE strategic choice facing Gov. Gray Davis in the struggle over electricit= y=20 price refunds has come down to three questions: When do you negotiate when= =20 do you demand and when do you bluff?=20 Negotiations are over Davis declared Tuesday. He demanded that the Federal= =20 Energy Regulatory Commission order refunds now. ``The case is nearly a year= =20 old'' he said. ``They have to decide which side they're on.''=20 Probably no one but Davis knew to what extent he was bluffing when he also= =20 said ``If you think California is going to settle for $1 billion in refund= s=20 we will see you in court.''=20 A FERC administrative judge said Monday that the amount due the state may b= e=20 around $1 billion or perhaps nothing at all when counter-claims against t= he=20 state are subtracted.=20 Energy experts are divided about whether the state would win a suit to=20 overturn a decision by a federal commission. The federal courts have some= =20 limited jurisdiction according to University of California Energy Institut= e=20 director Severin Borenstein but that a court would reverse a commission in= a=20 case like this is ``extremely unlikely.''=20 Frank Wolak a Stanford economist had the opposite view when asked whethe= r=20 the state has a good chance of winning: ``I think so. It happens all the=20 time.''=20 At a Sacramento press conference Davis continued to insist that there have= =20 been overcharges of $8.9 billion. But other state officials conceded that= =20 only $5.4 billion of that is actually on the table in the FERC proceedings.= =20 Davis said he'll take what he can get there and sue for the rest.=20 The state argues that because FERC has determined that wholesale prices hav= e=20 not met the Federal Power Act's requirement to be ``just and reasonable''= =20 refunds are in order. But the commission has not defined what portion=20 exceeded ``just and reasonable.''=20 Throughout his press conference Davis used the prospect of litigation like= a=20 goad to spur the federal regulators into action. But if you listened=20 carefully he also indicated he'll give them more time to consider the case= .=20 Considering the iffy odds of winning in court we suggest he keep goading t= he=20 federal commissioners -- while giving them all the time they need. Wednesday July 11 2001=20 Lights go out on Davis' power show=20 Three new developments show that some economic reality finally is being=20 applied to California's electricity crisis:=20 First The nation's chief energy judge said Monday that California is owed= =20 maybe $1 billion in refunds from power generators a fraction of the $8.9= =20 billion demanded by Gov. Gray Davis reported the Register yesterday. Even= =20 that $1 billion amount might be balanced by the amount the state still owes= =20 the power producers.=20 To suggest workable and market-oriented solutions to the California=20 electricity crisis. Judge Curtis Wagner's recommendation will be taken up by the Federal Energy= =20 Regulatory Commission which is being petitioned for the money by the state= =20 of California.=20 Because the judge's words will bolster FERC's apparent desire not to grant= =20 the refunds the state probably will go to court where the matter could = be=20 stuck for years. In the long term this may indicate that competitive electricity has a=20 future even in California but not thanks to the state Robert Michaels a= =20 professor of economics at Cal State Fullerton told us. He's referring to t= he=20 state's botched 1996 deregulation effort which has been made worse by Go= v.=20 Gray Davis and other officials since the crisis began a year ago. FERC since the 1980s favors competition within the parameters of politica= l=20 reality Mr. Michaels added. Now we're at square one: The industry doesn'= t=20 owe $9 billion to California. As this process continues he said another= =20 positive aspect will be that a lot of facts will get aired. We'll see what= =20 has been happening in the markets in which power is bought and sold. Second light already is shining on one area: This crisis was not Made in= =20 Texas'' by cronies of President Bush as Gov. Davis and other Democrats hav= e=20 been contending.=20 In May the governor attacked the president for ignoring the greed of thes= e=20 Texas energy companies such as Reliant and Dynergy. In fact according to information on state power contracts the governor=20 finally released Monday Texas companies were way down on the list of=20 producers.=20 In roughly the first five months of the year the state shelled out $1.2= =20 billion to Atlanta-based Mirant the most any company was paid for=20 electricity followed by $1 billion to Powerex the marketing arm of BC Hyd= ro=20 in British Columbia [in Canada]. It also paid $331 million to the Los Angel= es=20 Department of Water and Power reported the San Jose Mercury News. Only about 10 percent of our state's power during this period came from=20 companies with headquarters in Texas. Third and finally a new study by the Cato Institute shows what should be= =20 done next:=20 lAbolish retail rate caps allowing prices to be set by the market.=20 This would be a better system than the present one where the state buys th= e=20 electricity and passes much of the cost along through the state budget (pai= d=20 by taxpayers) and bonds paid for by long-term electricity price increases.= =20 Higher immediate prices would encourage conservation and production leadin= g=20 in time to lower prices. lMove to real-time pricing so people shift activities such as washing to=20 off-peak hours.=20 lAbolish the Independent System Operator which moves electrons around.=20 Give this function back to the utilities who did it far better before=20 deregulation. Gov. Davis should set the pace by ending his Clintonian bla= me=20 shifting and embracing these realistic solutions.=20 | other | informative | 1 |
Confidential Question | Dear Ken I'm not sure quite were to turn but was hoping you could assist me. I would like to keep this confidential especially regarding the New York Office. As my request has nothing to do with the people in this office or the group they are wonderful I've been with Enron since '97 and I relocated up to Connecticut to work with the New Power Company when I thought that the Enron employees would stay Enron employees. Afterwards of course we all were changed to NewPower employees. After a couple of months I made the move back to Enron and went to the New York office and work with the Enron Metals group here at 53rd street. (It was never my intention to leave Enron) Since the bombing I feel very displaced and my husband and I would really like to come back to Houston and was wondering if you could help me. I was on the trading floor working with Dave Delainey's group when he was in ENA and also was the Exec Secretary/Coordinator with the MWB group in George Warsoff's group. I would appreciate it very much if you were able to assist/guide me. Sincerely Teri Teri Connor-Smith Admin Coordinator Enron Metals & Commodities Corp tsmith3@enron.com (212)715-5601 | personal & social | concerned | 3 |
Re: Gas Controllers Association speaker (California Energy Crisis) | I can do it but have to be at the airport before 2:00 for a flight to NY. Sherri Sera 03/14/2001 04:17 PM To: Steven J Kean/NA/Enron@Enron cc: Maureen McVicker/NA/Enron@Enron Mary Poorman/NA/Enron@Enron Subject: Gas Controller's Association speaker (California Energy Crisis) Steve Jeff will be in Boston on this date doing 1:1s following 1Q earnings release. Is this something you would be interested in/available to do? If not who would you recommend sending it to? Thanks SRS ----------------- | other | formal | 3 |
null | Attached are FERC reports | energy infrastructure | formal | 3 |
RE: Patent attorney | Larry Thanks | legal affairs | polite | 0 |
RE: Rice | Nelson I don't see any problems with #1. For number 2 mention that the paper was written when you were a studentt at Rice. Vince | other | casual | 1 |
Inventory of Skills Confidential Inquiry: Joe Jamail | VERY CONFIDENTIAL The following member has asked for help from the Inventory of Skills (IOS). You have been identified as one of the few members who has the skill to assist in this area. You may or may not have completed an IOS enrollment form. All information gathered for IOS is done on a confidential basis and will remain confidential. This member has no knowledge regarding who has been contacted. If you choose to help the necessary information follows so that you may contact this member directly. If you cannot assist this member please contact them or IOS. IOS asks that you please respond within 72 hours of receiving this request. Thank you Brenda Worley IOS does not evaluate the validity of any request. Name: Ted L. Dub Snider Jr. Chapter: Lone Star-Dallas Phone: 501-401-7601 Fax: 501-401-7628 Email: dsnider@connect.com Other: * Indicated preferred method of contact. My company has been severely damaged by $50 billion (revenues)Texas based company 1) refusal to pay monies owed under a contract. 2) misrepresenting information used to calculate amounts owed under the contract 3) appears to have instigated an FBI investigation of our company regarding a pending civil and regulatory dispute. I am looking for an introduction to Joe Jamail by someone who knows him. We need an attorney with the courage confidence and track record to successfully pursue our claim against a powerful adversary. Thank You. | other | confidential | 5 |
California Power Markets | ----------------- | energy trading | neutral | 0 |
null | fyi ----------------- | other | casual | 0 |
Customers | You may want to forward this to your customers. ----------------- | other | formal | 3 |
Feedback from KL/JS CA Memo | Perhaps we should consider putting something together on India? | other | casual | 2 |
California Pricing | For the call with Davis this am..... | other | casual | 3 |
Re: India And The WTO Services Negotiation | fyi ----------------- | other | casual | 0 |
Enrons policy on Libya | I assume we avoid Libya completely. The question though may be how we proceed if we are doing business with someone who has activities in Libya. Your views please. | government & politics | cautious | 3 |
RE: Next Corporate Policy Committee Offsite | I think wholesale will be well covered. Enron Capital & Trade Resources Corp. From: Sherri Sera 04/26/2001 02:51 PM To: Steven J Kean/NA/Enron@Enron cc: Subject: RE: Next Corporate Policy Committee Offsite How much of an issue is this? So far Mark is the only one that has responded with a conflict. Please advise. Thanks SRS ----------------- | other | formal | 3 |
Re: confidential employee information-dutch quigley | thx Jeanie Slone 12/19/2000 04:51 PM To: John Arnold/HOU/ECT@ECT cc: Subject: confidential employee information-dutch quigley Dutch requested a meeting with me today and I gave him the scoop on the promotion. I will follow-up with him after our meeting the first week of Jan. He was ok with everything. let me know if you need anything else. ----------------- | human resources | casual | 1 |
Confidential & Proprietary - PanNat Valuation Update (7.24.01) | Jeff As requested below find the updated valuation assuming the contract is amended beginning September 1 2001 based on July 23 2001 curves Let me know if you have any questions. Eric <Embedded Picture (Metafile)> | finance | formal | 3 |
Carin Energy Rumor | ----------------- | other | neutral | 3 |
RE: Test Message | Mike Thanks for your message. The meeting on Tuesday at 7 is confirmed. Vince | other | friendly | 2 |
Re: HP -- confidential internal document | Good plan. I agree re SJ. She is on the ball. mh Patrick Tucker 12/14/00 04:28 PM To: Matt Harris/Enron Communications@Enron Communications cc: Dale Clark/Enron Communications@Enron Communications Subject: Re: HP -- confidential internal document I agree. Sarah-Joy and I had a detailed follow-on conversation today about this topic and we're in agreement as to how things can move forward. I'd definitely like to have Bill rejoin our conversation with our new overall commercial contact at HP whose name Greg Pyle and Bill Lovejoy will supply in the very near future. I understand that Peter Goebel was quite clear with HP in today's meetings regarding the imminent nature of his wireless decision the breadth of vendors with whom he could conceivably do business and the fact that the wireless deal and the Enron sell side are inextricably linked. Sarah-Joy mentioned that Gerry has not been present in the more recent conversations which we're taking to indicate that Bill and Greg understand that his focus was different than ours. Sarah-Joy has brought immense focus and organization to this process. I have certainly found her involvement invaluable. Patrick Matt Harris 12/14/00 10:51 AM To: Sarah-Joy Hunter/NA/Enron@ENRON cc: Dale Clark/Enron Communications@Enron Communications Jennifer Medcalf/NA/Enron@Enron Patrick Tucker/Enron Communications@Enron Communications Peter Goebel/NA/Enron@Enron Subject: Re: HP -- confidential internal document This is an excellent update. Thanks for putting this together. Dale/Patrick - lets regroup on how we want to move this onward. Seems like SJ's suggestion of our spending more time with Bill Dwyer is a good one. Thanks Matt Sarah-Joy Hunter@ENRON 12/12/00 02:42 PM To: Matt Harris/Enron Communications@Enron Communications cc: Patrick Tucker/Enron Communications@Enron Communications Peter Goebel/NA/Enron@Enron Dale Clark/Enron Communications@Enron Communications Jennifer Medcalf/NA/Enron@Enron Subject: HP -- confidential internal document Matt: As GSS Business Development transitions the HP relationship for broadband to your team there are several issues I wanted to clarify in terms of how the relationship has been developed and who the contacts have been to date. Additionally I outlined the discussion points/action items from this morning's meeting you held with Jennifer Medcalf and myself. Per your request the HP presentation complete with a listing of HP's business partners was e-mailed to you this morning. HP contacts to date: Bill Lovejoy Western Gulf Area Sales Manager Houston TX #(713)-439-5587 (Gerry Cashiola's boss) Gerry Cashiola sales representative Houston TX #(713)-439-5555 (To date HP person coordinating the relationship--seeking a short term play) Greg Pyle Solution Control Manager Southeast Region Austin TX (#(512)-257-5735 (Pyle has been playing the business developer role but continues to defer leadership of the process to Gerry Cashiola) Daniel Morgridge Manager of Internet - E-Services long term alliances Austin TX #(512)-257-5736 (Interested in E-services/wireless longer term alliances) Bill Dwyer Chief Architect e-Services Solutions Cupertino CA #(408)-447-5240 (To date clearly the most knowledgeable person on HP's business propositions strong technical financial background to craft value propositions. Gerry Cashiola and Greg Pyle deferred to his judgement in the 11/16th meeting) Matt On November 10th GSS Business Development took HP through a tour of Enron's trading floor the gas control center and the peaking power plant unit center on the trading floor. This tour was one meeting amongst several held in October and November to provide HP a full overview of Enron's products and services and introduce them to appropriate contacts at Enron (EBS GSS buy side -- Peter Goebel). On November 16th GSS Business Development Patrick Tucker and Dale Clark outlined 3 possible EBS/HP focus areas -- connectivity storage and wireless. Three EBS action items were defined in that meeting: 1) HP was to provide an HP contact on connectivity (to date Gerry Cashiola has stalled on providing this). Sarah-Joy will continue to pursue this information and get a sense from Gerry Cashiola of what he means by short term opportunity. What is HP's time horizon for short term? 2) EBS and GSS/BD was to facilitate a conference call on Storage with Ravi to explore size and potential scope of opportunity (completed 12/8) 3) GSS/BD was to facilitate a conference call with Peter Goebel GSS IT Sourcing Portfolio Leader (set for 12/14) In conversations with you Jennifer Medcalf and myself this morning several decisions on forward-looking strategy with HP/EBS were confirmed: Gerry Cashiola has been unable to take control of the process. More importantly despite numerous visits to Enron in which he has had overviews of Enron's products and services met with Peter Goebel and his team on the GSS buy side and participated in an Experience Enron tour Gerry has been unable to define an HP business proposition. The coordination between Cashiola (short term initiative) Morgridge (long term 12-24 months) has remained unorganized. These initiatives need to be developed separately. Clearly the conversations with HP need to be elevated to a more senior level so EBS can work with HP decision makers who can move the relationship forward at a strategic level. As the relationship is developed at this strategic level shorter term opportunities will crop up along the way. But Gerry's short term plans will not be the focus of the EBS/HP relationship rather a by-product. To facilitate this process of elevating the relationship Jennifer Medcalf and I are following up with Bill Lovejoy and Greg Pyle. Lovejoy's boss is Dan Sytsma VP of HP's America's Central Region. In the conference call Thursday 12/14 with Peter Goebel and HP regarding wireless initiatives Peter will support the GSS/BD push for the HP/EBS initiative by reiterating the following two points: a) Enron is already an HP customer the onus is on HP to move forward on the process of building a strategic relationship (IBM and Lexmark are only some of the HP competitors who could push them out of the running) b) HP's ability to bring the right people to the table will influence HP's business relationship process with Enron Patrick Tucker and Dale Clark could build their relationship with Bill Dwyer Chief Architect e-Services Solutions (met at the meeting 11/16) in the near term. Perhaps plan a visit to Cupertino California to see Dwyer in person. We look forward to continuing close collaboration with your team on this and other opportunities. Sarah-Joy Hunter Enron Corporation Global Strategic Sourcing - Business Development #(713)-345-6541 | other | formal | 3 |
Energy Issues | Please see the following articles: AP Wires Thurs 3/22: Report: Power wholesalers overcharged California $5.= 5=20 billion Dow Jones Newswires Thurs 3/22: Reliant To Appeal Fed Judge Ruling To Sel= l=20 Pwr To Calif Sac Bee Thurs 3/22: Federal judge orders major power wholesaler to sell t= o=20 California San Jose Mercury News Thurs 3/22: State falling short on pacts that provi= de=20 low-cost energy Contra Costa Times Thurs 3/22: Crisis saps state surplus Sac Bee. Fri 3/23: Bill to pay small energy firms stalls Sac Bee Fri. 3/23: House panel ends energy hearings -- will it step in? Sac Bee Fri 3/23: Dan Walters: Crisis deepens: politicos panic San Diego Union Fri. 3/23: Report says power wholesalers overcharged=20 state $6 billion San Diego Union Fri 3/23: Disappearing state surplus sparks alarm San Diego Union Fri. 3/23: Outages darken economic outlook in state so= me=20 say San Diego Union Fri. 3/23: Out-of-state generators question power=20 regulators' authority San Diego Union Fri. 3/23: Allegheny Energy makes big California=20 connection LA Times Fri 3/23: Judge Frees Small Firm From Edison Contract SF Chron Fri 3/23: Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills' SF Chron Fri 3/23: Coming Down to the Wire=20 State legislators battle over alternative energy bills SF Chron Fri 3/23: Grid Operators Push to Prevent Overcharging=20 They say regulators must be aggressive to stop billing abuses=20 Mercury News Fri. 3/23: State's bill for energy could double this year Mercury News Fri. 3/23: Plan for alternate power plants stalls --- --- Report: Power wholesalers overcharged California $5.5 billion=20 DON THOMPSON Associated Press Writer Thursday March 22 2001=20 2001 Associated Press=20 (03-22) 11:41 PST SACRAMENTO Calif. (AP) -- Electricity wholesalers have= =20 overcharged California more than $5 billion since May by manipulating the= =20 energy market according to a report prepared for power grid managers.=20 The Independent System Operator will file the findings with federal=20 regulators and ask for a refund ISO spokesman Patrick Dorinson said.=20 The state auditor also said Thursday that the state's 1996 deregulation law= =20 encouraged both buyers and sellers of electricity to ``manipulate wholesale= =20 prices to their advantage'' by underestimating supply and demand.=20 The auditor's report lays out what it calls ``a complex combination'' of=20 deficiencies and misjudgments it says led to the state's power problems.=20 According to the ISO report five in-state power suppliers and 16 importers= =20 frequently offered electricity at prices higher than it cost them to produc= e=20 -- effectively withholding supplies -- or didn't bid at all when they were= =20 able to generate power.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= =20 conference in Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 The commission has recently stepped up scrutiny of power companies' behavio= r=20 during California's power crisis asking suppliers to justify $124 million = in=20 sales during the first two months of the year or refund the money. Critics= =20 claim thousands of additional questionable sales are not being challenged.= =20 California has been spending about $45 million a day -- $4.2 billion since= =20 January -- to purchase power for Pacific Gas and Electric Co. and Southern= =20 California Edison. Both utilities the state's largest have been cut off b= y=20 electricity wholesalers because their credit is almost worthless.=20 Edison and PG&E say they are nearly $14 billion in debt due to soaring=20 wholesale power costs. The state's deregulation law blocks them from=20 recovering the costs from customers.=20 State Controller Kathleen Connell said Wednesday that the state's=20 power-buying is gutting its budget surplus.=20 Since the state started making emergency power buys the surplus has fallen= =20 from $8.5 billion to about $3.2 billion she said.=20 Connell ordered an audit of the power buys saying Gov. Gray Davis is=20 withholding key financial information from her office and the Legislature.= =20 She said she would refuse to transfer $5.6 billion into a ``rainy day fund'= '=20 she said was set up to impress Wall Street as the state prepares to issue $= 10=20 billion in revenue bonds to cover its power buys.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routin= e=20 and required by law.=20 ``The law says she has to do it. The law does not give her the power to=20 demand that kind of audit information'' Harrison said.=20 Davis spokesman Steve Maviglio said the administration has released the=20 financial information it can without jeopardizing negotiations for long-ter= m=20 power contracts with wholesalers.=20 Also Wednesday a federal judge ordered a major wholesaler Reliant Energy= =20 Services to continue selling power to California despite its fear that it= =20 will not be paid.=20 The ISO buys power from companies like Reliant on behalf of utilities in=20 attempts to fend off rolling blackouts like those that hit the state this= =20 week and during two days in January.=20 --- Reliant To Appeal Fed Judge Ruling To Sell Pwr To Calif 03/22/2001 Dow Jones Energy Service (Copyright (c) 2001 Dow Jones & Company Inc.) LOS ANGELES -(Dow Jones)- Reliant Energy Inc. (REI) said Thursday it will= =20 immediately file with the 9th Circuit Court of Appeals in San Francisco in= =20 response to a federal judge's ruling late Wednesday that the company contin= ue=20 selling power to California regardless of whether it is paid.=20 U.S. District Court Judge Frank Damrell granted California's Independent=20 System Operator which makes last minute power purchases in the spot market= =20 a preliminary injunction against Reliant saying Californians were at risk = of=20 irreparable harm if Reliant stopped selling power to the state. The ISO manager of the state's electricity grid said the judge's ruling= =20 will allow the agency to keep the lights on in California.=20 Reliant which is owed more than $300 million from the state's cash-strappe= d=20 utilities supplies California with about 3000 megawatts of electricity fr= om=20 power plants it owns in the state.=20 Reliant spokesman Richard Wheatley said the state Department of Water=20 Resources the agency that buys California's bulk power needs on behalf of= =20 PG&E Corp. (PCG) unit Pacific Gas & Electric Edison International (EIX) un= it=20 Southern California Edison and Sempra Energy (SRE) unit San Diego Gas &=20 Electric should back the ISO's last minute power purchases.=20 In a filing with the Securities and Commission Reliant said it is owed $10= 8=20 million by the DWR for last minute power purchases the ISO made during the= =20 six weeks prior to the agreement Reliant made with the DWR.=20 Damrell dismissed Reliant's claim saying he does not have the authority to= =20 force the DWR to pay for that power.=20 We're going to immediately appeal Judge Damrell's order Wheatley said.= =20 Clearly the judge understands the implications of his order. We are requir= ed=20 to do business with creditworthy entities. Unfortuantely the judge did not= =20 force the ISO to post a surety bond which would allowed us to do business= =20 with the ISO.=20 Gov. Gray Davis has said the state is not responsible for the last minute= =20 power purchases the ISO makes despite a law passed authorizing the DWR to= =20 buy power on behalf of the utilities.=20 Wheatley added that the company will also seek relief on the issue at the= =20 Federal Energy Regulatory Commission. Damrell's ruling remains in effect=20 until the Federal Energy Regulatory Commission rules on the matter.=20 Separately Wheatley said a short-term power supply contract that Reliant= =20 signed with the DWR expired Monday and the DWR has not renewed the contract= .=20 A spokesman for the DWR would not comment on the issue.=20 -By Jason Leopold Dow Jones Newswires 323-658-3874=20 jason.leopold@dowjones.com --- --- ----------------------- Federal judge orders major power wholesaler to sell to California Updated: March 21 2001 - 8:23 p.m.=20 A federal judge issued a preliminary injunction Wednesday ordering a major= =20 electricity wholesaler to continue selling to California despite its fear= =20 that it will not get paid.=20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant Energy Services stopped selling power to the=20 Independent System Operator which oversees the state's power grid. The ISO= =20 buys last-minute power on behalf of utilities to fill gaps in supply to try= =20 to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The state has been spending about $50 million a day on power for Pacific Ga= s=20 and Electric Co. and Southern California Edison both denied credit by=20 suppliers after amassing billions of dollars in debts. The judge said he had no authority to force the DWR to pay for that power.= =20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 Damrell denied the ISO's request for preliminary injunctions against three= =20 other wholesalers Dynegy AES and Williams who agreed to continue selling= =20 to the ISO pending the FERC ruling.=20 Spokesmen for Reliant Dynegy AES and Williams were out of the office=20 Wednesday night and didn't immediately return calls from The Associated Pre= ss=20 seeking comment on the ruling.=20 The ISO went to court in February after a federal emergency order requiring= =20 the power sales expired. The judge then issued a temporary restraining orde= r=20 requiring the sales but dropped it after the suppliers agreed to continue= =20 sales to California pending his Wednesday ruling.=20 The ISO said it would lose about 3600 megawatts if the suppliers pulled ou= t=20 enough power for about 2.7 million households. One megawatt is enough for= =20 roughly 750 homes.=20 Grid officials said Reliant's share alone is about 3000 megawatts. Reliant= =20 said the amount at issue actually is less than a fourth of that because mo= st=20 of the power is committed under long-term contracts.=20 Reliant which provides about 9 percent of the state's power worries it=20 won't get paid due to the financial troubles of PG&E and Edison.=20 PG&E and Edison say that together they have lost about $13 billion since Ju= ne=20 due to soaring wholesale electricity costs that California's 1996=20 deregulation law bars them from passing onto customers.=20 At the same time the state has faced a tight electricity supply due in pa= rt=20 to California power plant shutdowns for maintenance and to a tight=20 hydroelectric supply in the Pacific Northwest.=20 Managers of the state power grid imposed rolling blackouts across the state= =20 Monday and Tuesday as supply fell short of demand. Wednesday cooling=20 temperatures and the completion of repairs at several power plants allowed= =20 the state to avoid blackouts. State Controller Kathleen Connell said Wednesday that the energy crunch als= o=20 imperils California's financial health. Connell said the state's power-buying on behalf of Edison and PG&E is is=20 gutting its budget surplus. Since the state started making emergency power= =20 buys in January the surplus has fallen from $8.5 billion to about $3.2=20 billion she said.=20 Connell ordered an audit of the state's power-buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is refusing a request by Davis and the Legislature to transfer $5.6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its=20 power-buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 The law says she has to do it. The law does not give her the power to dema= nd=20 that kind of audit information Harrison said.=20 He said the state's budget isn't in danger because it will be repaid with t= he=20 $10 billion in long-term debt.=20 Wells Fargo & Co. chief economist Sung Won Sohn said he sees little progres= s=20 in efforts to fix the state's power problems and end state electricity=20 purchases.=20 If we're going to pour money into a bottomless pit I would worry about th= e=20 state's finances he said. At some point we're going to run out of money.= The controller's criticism of fellow Democrat Davis won support from Assemb= ly=20 Republicans and Secretary of State Bill Jones a Republican considering=20 challenging Davis next year.=20 Jones said he wants to announce his own plan to solve the state's energy=20 woes but can't unless Davis releases more financial details.=20 Davis spokesman Steve Maviglio dismissed the criticism. Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Maviglio said the administration has released the financial information it= =20 can without jeopardizing negotiations for long-term power contracts with=20 wholesalers.=20 Also Wednesday a report by Davis' chief power negotiator appears to show= =20 that as much as 75 percent of the state's power purchases will have to be o= n=20 the expensive short-term market this summer said Sen. Debra Bowen D-Marin= a=20 del Rey chairwoman of the Senate Energy Committee.=20 The prices may be phenomenol she said particularly given predicted=20 hydroelectric shortages due to drought in the Pacific Northwest.=20 The report by David Freeman who is negotiating the state's long-term power= =20 contracts shows California has finalized 19 contracts and has 25 agreement= s=20 in principle. Freeman said DWR is continuing to negotiate other contracts. Bowen said FERC should impose short-term price caps or let generators to=20 charge enough to make a reasonable profit or we could be subject to enormo= us=20 price-gouging this summer.=20 -- Associated Press --- State falling short on pacts that provide low-cost energy=20 Published Thursday March 22 2001 in the San Jose Mercury News=20 BY CHRIS O'BRIEN AND JOHN WOOLFOLK=20 Mercury News=20 The state has signed low-cost contracts for just a third of the energy it= =20 needs this year raising the prospect that California could be forced to bu= y=20 much of its electricity this summer on the expensive spot market.=20 A spokesman for Gov. Gray Davis conceded Wednesday that the state will be i= n=20 trouble without more contracts but insisted California will meet its needs= =20 through conservation and additional long-term deals for cheap electricity.= =20 The state according to a report released Wednesday has fallen far short o= f=20 the governor's goal of filling almost all its electricity needs through suc= h=20 deals. In fact the state has lined up contracts for about half the amount= =20 Davis had projected earlier this month.=20 If the state has to rely heavily on the volatile spot market where the pri= ce=20 of electricity this summer could reach five times the state's contract pric= e=20 pressure could mount to raise the cap on the electricity rates consumers pa= y.=20 But Steven Maviglio the governor's spokesman said ``The governor has sai= d=20 he's committed to work this in the existing rate structure so that's the= =20 plan.''=20 In the report sent to state lawmakers the state Department of Water=20 Resources indicated that it had secured just more than 20 million=20 megawatt-hours for this year leaving it far short of the 60 million=20 megawatt-hours needed.=20 ``This is just a progress report'' Maviglio said. ``They did all this in= =20 three weeks which is pretty amazing when you think about it and we have a= =20 lot more to do.''=20 The state got into the power buying business in January supplying it to th= e=20 state's nearly bankrupt utilities.=20 The state negotiated long-term contracts with generators to supply that pow= er=20 at a reduced rate. Based on the report the state will pay an average of $6= 8=20 per megawatt-hour over the next 10 years -- significantly less than in=20 December when prices spiked higher than $300 per megawatt-hour but not as l= ow=20 as the $55 Davis hoped to reach.=20 Most of this power however won't be delivered until 2004. From 2004 to=20 2006 the Department of Water Resources estimates it has enough power unde= r=20 contract. Until then the amount falls short.=20 In 2001 it appears the state has about one-third of the power it needs. Th= e=20 gap closes to about half in 2002 and two-thirds in 2003.=20 At a news conference in Los Angeles two weeks ago Davis said the state wou= ld=20 have to buy only 30 to 45 percent of the power it needs this summer on the= =20 open market.=20 At the time critics said with only two-thirds of the power under contract= a=20 rate increase was almost inevitable. Even Davis' chief negotiator S. David= =20 Freeman offered a bleak assessment for the summer saying that all availab= le=20 electricity has already been sold.=20 ``We'll be subject to extremely high prices'' said Frank Wolak a Stanford= =20 professor who sits on a market committee for the Independent System Operato= r=20 the agency that runs the state power grid.=20 Wolak said there are two main hopes for avoiding a price increase this=20 summer: Federal officials could cap the wholesale price a step they've=20 resisted or Californians can conserve an unprecedented amount of power. --- --- ----------------------- Crisis saps state surplus POWER CRISIS=20 Controller moves to block a transfer of funds saying the $8.5 billion=20 surplus has been cut more than half since January=20 By Mike Taugher TIMES STAFF WRITER=20 The energy crisis has bled California's once-touted budget surplus by more= =20 than half since taxpayers began buying electricity two months ago leading = a=20 top state finance official Wednesday to order an audit of the power purchas= es=20 and block Gov. Gray Davis' plan to transfer funds into a reserve account.= =20 A booming economy last year produced a budget surplus that totaled $8.5=20 billion in January. But that figure now stands at about $3.2 billion=20 according to Controller Kathleen Connell.=20 We started this year with a generous budget surplus Connell said in a=20 statement announcing her decision to block what Davis administration=20 officials described as a routine transfer of surplus money. The energy=20 crisis has taken much of that away and this transfer on top of the=20 electricity purchases would put the fund at risk.=20 Meanwhile the Davis administration released a report by David Freeman the= =20 governor's chief negotiator on power purchases on the progress of executin= g=20 long-term agreements meant to stabilize the power buys.=20 According to the report only about 40 percent of the electricity needed fr= om=20 the open market this year has been lined up. That means the state could be= =20 forced to continue buying a substantial amount of power on the highly=20 expensive spot market and further drain its coffers.=20 And a key regulatory panel is scheduled next week to issue a ruling that=20 would determine how quickly state funds will be replenished when it decides= =20 what portion of electric bill payments should be allocated to the state=20 treasury a decision that could include a rate increase to fully repay=20 taxpayers without further crippling the state's two largest electric=20 utilities.=20 The Public Utilities Commission also will consider whether it will force th= e=20 utilities to pay alternative energy producers whose shutdowns this week=20 contributed to blackouts.=20 Connell's action underscores a growing nervousness over the sheer volume of= =20 money that is being poured into energy buys despite the fact that state=20 officials plan to replenish the treasury with up to $10 billion in loans th= at=20 will be repaid by electricity consumers.=20 The state has committed to spending $4.2 billion to date to keep lights on= =20 since taxpayers were forced in mid-January to take over electricity buys fr= om=20 the financially crippled utilities Pacific Gas & Electric Co. and Southern= =20 California Edison. Tax money is going out at a clip of about $50 million a= =20 day.=20 High prices already have brought PG&E and Edison to the brink of bankruptcy= =20 and now the state's surplus is at risk according to Connell.=20 In addition to requesting an audit and announcing her intention to delay th= e=20 transfer to the reserve account Connell said she wanted the administration= =20 to send her office more information about the electricity purchases.=20 Davis' representatives questioned Connell's authority in trying to block th= e=20 funds transfer which they called a routine accounting procedure and accus= ed=20 her of making political hay.=20 It is not helpful to the taxpayers or ratepayers or the people who just wa= nt=20 to keep the lights on it isn't helpful to have the situation muddied like= =20 this said Sandy Harrison a Finance Department spokesperson. We're sorry= =20 it came up in this manner.=20 Connell and the administration have butted heads in recent weeks. The=20 controller wants to post details of the state's electricity purchases on he= r=20 Web site a plan that have been delayed under pressure from Davis because o= f=20 the governor's concerns that releasing those details will allow power=20 generators and traders to sell at higher prices.=20 Harrison said administration officials believe Connell lacks the authority= =20 either to block the funds transfer to a reserve account or to audit the sta= te=20 water resources department.=20 Two days of widespread blackouts this week show how vulnerable the power gr= id=20 is to financial glitches. Although several factors combined to produce the= =20 blackouts state power officials say the outages could have been avoided if= =20 the utilities were paying their bills to alternative energy producers.=20 Many of those producers including clean-burning natural gas power plants= =20 wind solar and geothermal energy developers shut down enough production t= o=20 spell the difference between grid reliability and blackouts Monday and=20 Tuesday.=20 Davis called the utilities' failure to pay bills to those producers known = as=20 qualifying facilities immoral. The QFs were either unable to buy gas fro= m=20 their suppliers or were frustrated with the utilities' failure to pay them.= =20 The utilities hoarded billions of dollars since November without paying an= y=20 money out said Davis spokesman Steve Maviglio. They've got the money --= =20 we're pulling the trigger to make them pay it.=20 The utilities however say they are doing all they can to conserve enough= =20 cash to continue operating. Together they owe the QFs about $1.5 billion.= =20 Next week the PUC is scheduled to consider whether to force the utilities = to=20 heed Davis' demand to pay the QFs and it might also decide how much of=20 ratepayers' bill payments will be used to refund taxpayers for power buys.= =20 PG&E says that under a formula proposed by the administration the water=20 resources department would receive about 40 percent of the money collected= =20 from ratepayers for power purchases.=20 The rest of that money about $240 million would have to be divided among= =20 QFs existing power contracts operating PG&E's nuclear and hydroelectric= =20 plants and what hour-by-hour purchases the utility still must make on the= =20 spot market according to PG&E spokesman John Nelson.=20 There isn't enough to do that he said.=20 That is making it increasingly likely that electric bills will be hiked=20 according to a growing chorus of officials and experts.=20 Unless rates are raised Nelson said the only entity that can absorb a lac= k=20 of payment or a partial payment is the state treasury. Cutting off any othe= rs=20 will lead to electricity becoming unavailable and more blackouts he said.= =20 If they do it under existing rates -- given that the existing pool of mone= y=20 is not enough -- who doesn't get paid or who gets a partial payment? Nelso= n=20 said. What's the only entity left with wiggle room? The state.=20 Rate hikes are also a sticking point in negotiations to bail out the=20 utilities through purchase of their transmission lines and other assets=20 Maviglio said.=20 They want rate increases of significant magnitude and we're not going=20 there he said.=20 WE CAN TRIM STORY HERE IF NECESSARY BUT KEEP TAGLINES AT BOTTOM=20 About one-third the electricity needed by the customers of California's thr= ee=20 major utility companies is produced by the companies themselves one-third= =20 comes from alternative producers who use environmentally friendly technique= s=20 and one-third is bought on the open market.=20 The state stepped in to buy the one-third needed from the open market after= =20 the utility companies ran out of cash and credit in January to make the=20 purchases themselves.=20 But that electricity has proven to be enormously expensive and Davis has= =20 planned to lower those prices by committing to long-term purchases.=20 Freeman's report on the progress of those long-term purchases dated March = 15=20 but released this week said the state has finalized 19 contracts with seve= n=20 suppliers and reached 25 additional agreements.=20 Mike Taugher covers the environment and energy. Reach him at 925-943-8324 o= r=20 mtaugher@cctimes.com.=20 Staff writer Andrew LaMar contributed to this story. --- --- ----------------------- Bill to pay small energy firms stalls By Kevin Yamamura Dale Kasler and Jim Sanders Bee Staff Writers (Published March 23 2001)=20 A quickly melded proposal that would assure payments for alternative energy= =20 suppliers whose money woes contributed to power blackouts this week stalled= =20 Thursday in a divided Legislature.=20 The state Senate passed the bill AB 8x but with Republicans balking it w= as=20 rejected in the Assembly along party lines. Assembly leaders said they may= =20 try again today.=20 For most of Thursday lawmakers scrutinized legislation they had overhauled= =20 the night before to include Gov. Gray Davis' plan to force utilities to pay= =20 solar wind and small gas-fired suppliers. Such providers called qualifie= d=20 facilities or QFs provide more than 20 percent of California's=20 electricity and their shutdowns were partly to blame for rolling blackouts= =20 Monday and Tuesday.=20 Under the Democratic governor's plan the state Public Utilities Commission= =20 would determine prices at which alternative generators may sell power but= =20 legislation is needed to authorize the PUC action.=20 Lawmakers faced time pressures Thursday. They wanted to pass the bill quick= ly=20 so the PUC could act next week and legislators could embark Monday on an=20 annual three-day lobbying trip in Washington D.C.=20 Assembly Speaker Robert Hertzberg D-Sherman Oaks said the Republicans'=20 rejection of AB 8x could jeopardize more than $4 billion the state has spen= t=20 or allocated for electricity during the energy crisis.=20 Hertzberg said producers of alternative energy which are owed more than $1= =20 billion have threatened to drag debt-ridden utilities into involuntary=20 bankruptcy if the Legislature failed to pass the measure.=20 They said it and I believe it Hertzberg said. If such bankruptcies occu= r=20 he added the state with its multibillion-dollar debt would become just=20 another creditor in a pile of creditors.=20 But Assembly Republican leader Bill Campbell of Villa Park said the=20 finger-pointing is unfair. Passage of AB 8x would not necessarily prevent= =20 bankruptcies he said.=20 One alternative energy provider won a crucial court ruling Thursday that=20 staved off at least for a while threats by some creditors to haul one or= =20 both big utilities into bankruptcy court for nonpayment of bills.=20 CalEnergy Co. Inc. won the right to sell its geothermal power which was=20 contracted to Southern California Edison on the open market. CalEnergy sai= d=20 it is owed $45 million by Edison.=20 If the Imperial County judge hadn't ruled in CalEnergy's favor the company= =20 and seven other QFs were fully prepared to file an involuntary bankruptcy= =20 petition against Edison this morning said David Sokol chief executive of= =20 CalEnergy's parent MidAmerican Energy Holdings Co. of Des Moines Iowa.=20 That is currently off the table.=20 An involuntary bankruptcy proceeding would take California's energy crisis= =20 into uncharted territory although a bankruptcy judge would have the leeway= =20 to reject the filing.=20 Freed from its contract with Edison CalEnergy will move to sell its=20 electricity to people who will pay for it Sokol said.=20 Besides calming the bankruptcy movement temporarily the ruling also could= =20 prompt other alternative energy providers -- hundreds of which have shut do= wn=20 because of nonpayment by Edison and Pacific Gas and Electric Co. -- to foll= ow=20 CalEnergy's example and find other buyers for their electricity said Gary= =20 Ackerman of the Western Power Trading Forum an association of generators.= =20 Assembly Republicans said they felt the Senate's decision to package three= =20 important energy issues into a single bill was an attempt to ramrod=20 legislation through both houses.=20 We have to stand and say no Campbell said during floor debate.=20 Besides determining alternative generator payments the bill would change a= n=20 earlier law by capping the value of bonds the state may sell for power=20 purchases at $10 billion. It also would extend to large businesses an=20 existing rate cap in the San Diego Gas and Electric Co. service area.=20 And it would earmark a portion of rates paid by utility customers to fund t= he=20 state's ongoing power purchases. Within a week the state will have spent= =20 $4.2 billion on power since January.=20 Without the bill some legislators fear Pacific Gas and Electric and=20 Southern California Edison would be reimbursed before the state.=20 They have got (some) gall to go to the PUC and say they're going to go to= =20 court to keep our money -- to keep our money to pay off their creditors= =20 said Senate President Pro Tem John Burton D-San Francisco.=20 Most of the bill's controversy however centered on how the PUC would trea= t=20 gas-fired alternative generators.=20 The commission issued a revised draft decision Wednesday that would impose= =20 prices for qualifying facilities at $79 a megawatt-hour for five-year=20 contracts or $69 a megawatt-hour for 10 years.=20 But those producers that use natural gas -- representing about two-thirds o= f=20 the alternative energy providers in California -- spent Thursday arguing th= at=20 Davis' plan to rescue them would all but guarantee that they would go out o= f=20 business instead.=20 The plan -- ordering Edison and PG&E to pay them a fixed price for their=20 power -- would set rates well below the cost of natural gas they said.=20 Democratic lawmakers tried to assure such producers that the PUC would set= =20 prices that make business sense even obtaining a letter to that effect fro= m=20 Loretta Lynch who heads the commission.=20 Davis has vowed to fine Edison and PG&E if they don't pay alternative=20 producers for future deliveries. But Sokol said his company isn't convinced= =20 that Edison will pay.=20 Calling Edison a confrontive in-your-face nasty organization Sokol sai= d=20 the utility was sitting on $2 billion and not paying its bills. Edison i= n=20 a Securities and Exchange Commission filing Thursday said its debts outwei= gh=20 its cash reserves by $722 million.=20 The Senate sent the Assembly two other bills that deal specifically with=20 supply and demand. The first SB 5x would spend about $1 billion on energy= =20 conservation and low-income assistance programs. The other SB 28x would= =20 streamline siting procedures for power plant construction.=20 In separate energy-related matters Thursday the Assembly approved:=20 AB 21x which would allow businesses industries or other electrical=20 customers to negotiate private contracts with energy providers.=20 Nine energy bills designed to generate or save 665 megawatts of electricity= =20 -- including 345 megawatts this summer. One megawatt is enough electricity = to=20 light about 1000 homes.=20 The state put power emergencies behind it after dropping out of a Stage 1= =20 alert late Wednesday. The California Independent System Operator which=20 manages the state's power transmission grid was predicting no further aler= ts=20 this week. It expected cooling temperatures and a regular dropoff in=20 electricity use on Fridays to lessen demand at the same time that more pow= er=20 plants were returning to service.=20 Bee staff writer Carrie Peyton contributed to this report.=20 --- House panel ends energy hearings -- will it step in? By David Whitney Bee Washington Bureau (Published March 23 2001)=20 WASHINGTON -- A key House panel wrapped up a series of hearings on the=20 California electricity crisis Thursday and now will decide whether to come = to=20 the state's aid with legislation.=20 But the panel's Texas chairman made clear that West Coast price controls=20 won't be on the table.=20 Caps will not be in anything I am submitting said Rep. Joe Barton=20 chairman of the House Energy and Commerce Committee's energy and air qualit= y=20 subcommittee.=20 Some form of federal controls to hold down escalating wholesale prices this= =20 summer because of power shortages has been the most frequent appeal of=20 witnesses who testified before the panel during roughly 30 hours of hearing= s=20 over five days.=20 Such controls have been sought by the governors of California Oregon and= =20 Washington. As power shortages are forecast for other regions states like= =20 New York also have appealed for temporary price controls to halt gouging.= =20 But the Federal Energy Regulatory Commission which is responsible for=20 enforcing reasonable wholesale rates under the Federal Power Act has refus= ed=20 to impose them and the Bush administration is bolstering that decision by= =20 opposing any legislation that would compel such action.=20 Barton in a brief hallway interview declined to say what other legislativ= e=20 remedies he might propose to address the worsening California situation.=20 He said he expects to submit a list of ideas to the White House today and= =20 after receiving comment on it sit down with other committee Republicans an= d=20 Democrats next week to see if any legislation is in order.=20 If we are going to do anything to help California or the West this summer= =20 we have to make it law within the next month or six weeks Barton said.=20 Even the panel's senior Democrat Virginia Rep. Rick Boucher was urging a= =20 careful and deliberate approach to the California crisis which he said w= as=20 largely of the state's own making.=20 There are steps Congress might take to provide some help to the West such = as=20 more money for conservation and relaxed federal regulation of air quality= =20 standards. That would permit older more polluting generators to operate=20 through a long hot summer when electricity demand could exceed supply by= =20 about 3000 megawatts roughly the amount needed to power 3 million homes.= =20 But Alan Lloyd chairman of the California Air Resources Board said power= =20 production already is being maximized without sacrificing air quality.=20 Simply put no essential electricity generation has been curtailed due to= =20 air emission limitations he said. California's programs to protect publi= c=20 health are not major factors in the electricity shortages experienced to=20 date.=20 The concern is that as shortages turn into more rolling blackouts wholesal= e=20 prices will jump even higher and steadily bleed the economies of California= =20 and the West Coast.=20 William L. Massey the lone member of the energy regulatory commission who= =20 supports price controls said at a Tuesday hearing that without them the We= st=20 Coast faces economic catastrophe this summer.=20 It was evident from the comments of some Republicans that they think their= =20 party could capitalize politically from a difficult summer.=20 If they had a bad summer it could show up in the polls said Rep. Charli= e=20 Norwood R-Ga. And sometimes that's not a bad idea.=20 One of the most dramatic exchanges during the weeklong hearings came Thursd= ay=20 with S. David Freeman the former general manager of the Sacramento Municip= al=20 Utility District who now heads the Los Angeles Department of Water and Powe= r.=20 He recently was named Gov. Gray Davis' chief negotiator with power generato= rs=20 for long-term contracts to stabilize future deliveries.=20 Don't feel sorry for California Freeman said. We're going to come out o= f=20 this stronger than ever.=20 But Freeman said it will be a year or two before all the fixes are in place= =20 and in the meantime the region desperately needs Congress' help to force th= e=20 FERC into controlling wholesale prices which witnesses said are likely to= =20 rise from $7 billion last year to as much as $70 billion or more this year.= =20 We recognize that the current administration and various legislators have= =20 their own opinion as to the California situation Freeman said. But my=20 personal plea is that if the federal government is not going to help us th= e=20 least it should do is refrain from legislation that attempts to tell us wha= t=20 to do.=20 Barton perked up at that idea.=20 Leave California alone huh? Barton said. That might be a good motto.= =20 --- --------------------- Dan Walters: Crisis deepens: politicos panic (Published March 23 2001)=20 That choking sound you hear is California's political class shifting into= =20 near-panic mode as it realizes that the energy crisis is on the verge of=20 becoming a full-scale meltdown with utilities forced into bankruptcy and= =20 consumers hammered by severe and prolonged power blackouts and soaring=20 electricity bills.=20 The Legislature which had been content to allow Gov. Gray Davis to handle= =20 the crisis on his own suddenly came to life Thursday jolted by this week'= s=20 unexpected rolling blackouts and threats by creditors to force the utilitie= s=20 into bankruptcy court. Lawmakers quickly fashioned a basketful of legislati= on=20 aimed -- or so they hope -- at increasing power supplies promoting=20 conservation and relieving the financial pressure on utilities and=20 electricity generators. But it may be too little too late -- and Davis and= =20 other politicians are already pointing fingers of blame aware that a=20 political price will be paid if the apocalypse strikes.=20 While Davis chants his mantra that he inherited a fatally flawed utility=20 deregulation scheme from predecessor Pete Wilson Republicans are blaming= =20 Davis for moving too slowly after the crisis first surfaced last summer an= d=20 even some of Davis' fellow Democrats are distancing themselves from the=20 governor.=20 Deregulation was a product of a Republican governor a Republican author a= nd=20 a Republican PUC (Public Utilities Commission) that was unduly impatient= =20 Davis said at one point this week as the Capitol buzzed with private=20 negotiations and public posturing.=20 A day later however state Controller Kathleen Connell a Democrat issued= a=20 warning that Davis' power purchases running at $50 million a day had=20 already drawn down state budget reserves by nearly two-thirds and she=20 refused to authorize additional transfers. It was a direct shot by Connell = at=20 Davis an old rival and came just a day after the governor had endorsed a= =20 Connell foe Antonio Villaraigosa in the duel for mayor of Los Angeles.=20 Other Democrats didn't join Connell's direct challenge to Davis but there= =20 is nevertheless a growing concern among Democratic legislators that the= =20 power purchases are costing many billions of dollars more than the governor= =20 had projected and could place the state budget in jeopardy. They're nervous= =20 because Davis has refused to reveal even to legislators exactly how much= =20 power the state is buying each day and how much it is paying.=20 From the few details that have been disclosed it's clear that the state is= =20 spending about $1.5 billion a month which would wipe out the state's=20 reserves by midsummer. It's also becoming increasingly clear that Davis=20 probably can't make good on his promise to avoid major consumer rate=20 increases unless the state is willing to plunge deeply and semi-permanentl= y=20 into debt to underwrite wholesale costs or unless federal authorities orde= r=20 huge refunds from power suppliers.=20 Rates in areas served by private utilities have risen only slightly while t= he=20 costs first to utilities and later to the state soared. Data from the=20 administration and utilities when collated indicate that the state is in= =20 line to collect just 20 cents for every dollar it's spending on power=20 purchases and the gap will increase as summer heat drives up demand.=20 Privately some economists say that private utility rates will have to rise= =20 33 percent to 50 percent to cover costs of current power supplies plus=20 utilities' past debts to generators and the state's purchase of the=20 utilities' transmission system if that deal is made final.=20 It's ultimately going to break down and the ratepayer is going to pay for= =20 it one way or the other Republican Sen. Jim Battin said during one of=20 Thursday's many committee hearings on utility legislation. No one disagreed= =20 with him.=20 DAN WALTERS' column appears daily except Saturday. Mail: P.O. Box 15779= =20 Sacramento CA 95852 phone (916) 321-1195 fax: (781) 846-8350 E-mail: dwalters@sacbee.com Recent columns: --- Report says power wholesalers overcharged state $6 billion=20 By Don Thompson ASSOCIATED PRESS=20 March 22 2001=20 SACRAMENTO =01) Electricity wholesalers have overcharged California more th= an=20 $6.2 billion by manipulating the energy market according to a report by an= =20 economist working for power grid managers.=20 The Independent System Operator planned to file the findings with federal= =20 regulators Thursday and ask for a refund said ISO spokesman Patrick=20 Dorinson.=20 In a related development the state auditor said Thursday that the state's= =20 1996 deregulation law encouraged both buyers and sellers of electricity to= =20 manipulate wholesale prices to their advantage by underestimating both=20 supply and demand.=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 The auditor's report lays out what it calls a complex combination of=20 deficiencies and misjudgments it says led to the state's power problems.=20 The ISO's filing came a day after the state controller complained that a=20 relentless energy crisis is jeopardizing California's financial future.=20 Since May the companies manipulated the market by bidding at excessive=20 prices effectively withholding supplies or by not bidding at all when they= =20 had generation capability available according to the ISO study.=20 ISO Director of Market Analysis Anjali Sheffrin presented the findings at a= n=20 energy conference at the University of California Berkeley last week.=20 The companies have denied overcharging California and have said they expect= =20 the Federal Energy Regulatory Commission will determine their prices were= =20 justified.=20 In a burst of activity after weeks of delay both houses of the Legislature= =20 approved bills Thursday designed to ease the energy crisis.=20 The state Senate approved measures to encourage energy conservation and spe= ed=20 up power plant construction.=20 Topping that the Assembly sent the Senate 14 energy-related bills includi= ng=20 $455 million in loans and grants to encourage energy efficiency and=20 conservation and alternative energy projects by this summer.=20 One of the Assembly bills would require new energy plants approved by the= =20 state to sell their power within California before they offer it to other= =20 states.=20 The (California) Energy Commission says for every day we delay this bill= =20 there are 20 megawatts that could be saved that we're not saving said sta= te=20 Sen. Byron Sher D-Stanford as senators voted 28-10 to send his conservati= on=20 measure to the Assembly.=20 Senators also approved another Sher bill speeding up the siting of power=20 plants. It went to the Assembly on a 37-1 vote.=20 Meanwhile a federal judge issued a preliminary injunction Wednesday orderi= ng=20 one of the companies named in the ISO filing Reliant Energy Services to= =20 continue selling to California despite its fear that it will not be paid.= =20 U.S. District Judge Frank C. Damrell Jr. said Californians were at risk of= =20 irreparable harm if Reliant stopped selling power to the ISO which buys at= =20 the last minute on behalf of utilities to bolster supplies and try to fend= =20 off blackouts.=20 Such blackouts struck the state twice this week shutting off power to=20 hundreds of thousands of people from San Diego to Oregon snarling traffic= =20 and shutting down businesses.=20 The state remained free of any power alerts Thursday morning as power=20 reserves stayed above 7 percent.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= =20 Southern California Edison and Pacific Gas and Electric Co.=20 The judge said he had no authority to force the DWR to pay for that power.= =20 The utilities have been denied credit after amassing billions of dollars in= =20 debt paying high prices for power that the state's energy deregulation law= =20 prevents them from passing on to consumers.=20 Gov. Gray Davis has said the state isn't responsible for purchasing the=20 costly last-minute power the ISO buys for Edison and PG&E despite a law=20 authorizing state power purchases on the utilities' behalf.=20 ISO attorney Charles Robinson said the ruling gives ISO operators a tool t= o=20 assist them in keeping the lights on in California.=20 Had the decision gone the other way one could expect other generators to= =20 simply ignore emergency orders Robinson said.=20 Damrell's preliminary injunction will remain in effect until the Federal=20 Energy Regulatory Commission rules on the matter.=20 In another development Wednesday state Controller Kathleen Connell=20 complained that the energy crunch is imperiling California's financial=20 health.=20 Connell said the state's power buying on behalf of Edison and PG&E is gutti= ng=20 its budget surplus. Since the state started making emergency power buys in= =20 January the surplus has fallen from $8.5 billion to about $3.2 billion sh= e=20 said.=20 Connell ordered an audit of the state's power buying saying Davis is=20 withholding key financial information from her office and the Legislature.= =20 She is also refusing a request by Davis and the Legislature to transfer $5.= 6=20 billion into a rainy day fund she said was set up to impress Wall Street = as=20 the state prepares to issue $10 billion in revenue bonds to cover its power= =20 buying.=20 Transferring the money would leave the state general fund $2.4 billion in= =20 debt Connell said.=20 Sandy Harrison spokesman for the state Department of Finance and Keely=20 Bosler of the Legislative Analyst's Office said such transfers are routine= =20 and required by law.=20 They put the state's budget surplus at $5.6 billion.=20 Davis spokesman Steve Maviglio dismissed the criticism.=20 Political grandstanding doesn't generate one more kilowatt of energy for= =20 California in this time of emergency he said.=20 Connell is a candidate for mayor of Los Angeles in next month's election.= =20 The ISO study meanwhile covered five major in-state power suppliers =01)= =20 Reliant Dynegy Williams/AES Duke Energy and Mirant as well as 16 power= =20 importers. All deliver power to customers of Edison PG&E and San Diego Gas= &=20 Electric Co. the state's three largest investor-owned utilities.=20 All overcharged but some excessively and some by moderate amounts said= =20 ISO's Sheffrin.=20 According to the report the overcharging took place beginning last May wh= en=20 the energy crisis began and continued through last month.=20 During that time according to the report energy suppliers commonly offere= d=20 their electricity at twice the amount it cost them to produce.=20 FERC member William L. Massey said he wasn't shocked to hear the amount=20 overcharged added up to more than $5 billion.=20 Prices over the past 10 months in California have greatly exceeded the=20 federal standards of just and reasonable prices and I think they have=20 exceeded the standards by possibly billions of dollars he said.=20 Chuck Griffin spokesman for Atlanta-based Mirant said the company would=20 justify their charges to FERC officials.=20 I think we're missing sometimes just how basic the problem is in Californi= a.=20 Supply and demand are out of whack and some basic rules of economics kick i= n=20 when that happens he said.=20 --- ------------- Disappearing state surplus sparks alarm=20 Controller puts hold on transfer of $5.6 billion to reserve funds By Karen Kucher and Ed Mendel=20 UNION-TRIBUNE STAFF WRITERS=20 March 22 2001=20 The state's general fund surplus has dropped to $3.2 billion from $8.5=20 billion since January largely because California's power purchases are=20 devouring the money state controller Kathleen Connell said yesterday.=20 Connell said she wants to see more documentation about state power spending= =20 before approving the transfer of $5.6 billion from the general fund to a=20 special reserve fund requested by Gov. Gray Davis.=20 Connell said the state would have to borrow $2.4 billion to cover the=20 transfer.=20 Report says power wholesalers overcharged California $5.5 billion=20 Outages darken economic outlook in state some say=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 We started this year with a generous budget surplus. The energy crisis has= =20 taken much of that away and this transfer on top of the electricity=20 purchases would put the (general) fund at risk Connell said in a statemen= t.=20 Her action came on a day when state power supplies improved. After two days= =20 of forced outages this week no rolling blackouts were ordered yesterday.= =20 Several power plants came back on line and imports from the Pacific Northwe= st=20 provided enough electricity to meet demand yesterday said Stephanie=20 McCorkle a spokeswoman with the California Independent System Operator=20 which manages most of the state's power grid.=20 Gradually more (electricity) generation comes on every day McCorkle said= .=20 By Monday we should see somewhere around 2200 megawatts back in service= =20 that was not on this Monday. That's if no other generation falls off.=20 Meanwhile Connell's move took some by surprise.=20 A spokesman for the state Department of Finance said Connell is denying a= =20 routine transfer that is required by law. It was just a routine accounting= =20 measure that we didn't anticipate becoming controversial Sandy Harrison= =20 said.=20 Connell announced the denial of the transfer a day after Davis endorsed one= =20 of her opponents former Assembly Speaker Antonio Villaraigosa in the race= =20 for Los Angeles mayor.=20 Connell who monitors California's cash flow said she was deeply concerne= d=20 about putting the state's general fund in a deficit situation in light of t= he=20 energy crisis.=20 About two months ago the state began spending about $50 million a day to b= uy=20 power after Pacific Gas and Electric and Southern California Edison nearly= =20 went bankrupt. It is also purchasing power for customers of San Diego Gas a= nd=20 Electric.=20 The Davis administration said earlier this week it soon will begin spending= =20 an additional $500 million on power purchases bringing the total to $4.2= =20 billion.=20 As that staggering sum continues to grow the state won a court battle with= =20 an electricity supplier yesterday. A federal judge in Sacramento sided with= =20 the state and ordered the wholesaler to continue selling to California=20 despite its fear that it will not get paid.=20 Judge Frank C. Damrell Jr. said Californians were at risk of irreparable ha= rm=20 if Reliant Energy Services stopped selling power to the Independent System= =20 Operator. The ISO acquires last-minute power on behalf of utilities to fill= =20 gaps in supply to try to fend off blackouts.=20 Damrell dismissed Reliant's attempt to force the state Department of Water= =20 Resources to back the ISO's purchases for the state's two biggest utilities= .=20 The judge said he had no authority to force the DWR to pay for the power.= =20 Davis has said the state isn't responsible for purchasing the costly=20 last-minute power the ISO buys for Edison and PG&E despite a law authorizi= ng=20 state power purchases on the utilities' behalf.=20 Meanwhile those who manage the power grid say the forecast for power=20 supplies this week looks good although conditions can change quickly.=20 ISO managers continue to stress the importance of conservation. Utility=20 customers across the state conserved about 900 megawatts of power Tuesday= =20 which kept blackouts from being ordered that night.=20 As the power crisis worsened this week ISO managers wished aloud that they= =20 still could rely on business customers to shut down in exchange for lower= =20 energy rates.=20 Such interruptible customers saved as much as 2100 megawatts last spring= =20 a figure that dropped to about 1700 last summer and 1400 at the end of th= e=20 year. But in January the state Public Utilities Commission told utilities= =20 they could no longer impose fines on business customers who refuse to shut= =20 down when asked.=20 ISO managers realize the program was harming businesses with frequent=20 interruptions of service -- but they still miss having that option McCorkl= e=20 said.=20 It would have made an enormous difference but at the same time we=20 understand the impact it was having on businesses McCorkle said. --- -------------- Outages darken economic outlook in state some say=20 By Dean Calbreath? UNION-TRIBUNE STAFF WRITER=20 March 22 2001=20 Until this week the San Diego Regional Chamber of Commerce was predicting= =20 that the county was well-insulated from the growing threat of economic=20 recession.=20 But that was before the lights went out in the chamber's downtown=20 headquarters Monday.=20 Working by window light in his darkened office chamber economist Kelly=20 Cunningham rapidly erased his previous projections for 3.5 percent growth f= or=20 San Diego County. Cunningham now feels the local economy could fall into a= =20 recession thanks to its shaky supply of energy.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Out-of-state generators question power regulators' authority=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 Blackouts are very disruptive to the economy Cunningham said. A busines= s=20 can absorb rising energy prices by cutting costs or raising its own prices.= =20 But an energy shutoff is much less predictable. It cuts into productivity.= =20 Those sentiments are being echoed throughout California as business leader= s=20 and economists worry that rolling blackouts will darken the state's=20 previously glowing economy.=20 At the University of California Los Angeles for instance leading financia= l=20 theorists will meet April 4 to discuss the question Can California grow in= =20 the dark? Although the topic was chosen before the recent string of power= =20 outages the blackouts have given the issue new urgency.=20 These blackouts are not just a single episode said UCLA economist Tom=20 Lieser. They are a bridge to what will happen this summer. If we don't fal= l=20 into a recession in the second half of the year we will fall pretty close.= =20 Tapan Munroe an economist formerly with Pacific Gas and Electric this wee= k=20 crossed out his projection for 2 percent statewide growth. After blackouts= =20 rolled toward his consulting offices in the Bay Area city of Moraga Munroe= =20 decided the state will be lucky if it manages zero growth.=20 I'm a pretty optimistic guy by nature but this has been sobering Munroe= =20 said. On Tuesday one restaurant alone in San Francisco lost $20000.=20 Multiply that by all of the businesses that lost power in the state and=20 you've got a serious problem.=20 Two days of blackouts in San Diego County have hurt businesses large and=20 small. Among the industries under threat is the local biotechnology sector= =20 which requires a steady supply of electricity to power areas of laboratorie= s=20 that must remain temperature-controlled and sterile.=20 Continued blackouts could have a huge impact not only in dollars but=20 multiple millions of dollars said Tom Oster vice president of operations= =20 for BioCom the leading trade organization for the more than 200 biotechs i= n=20 San Diego County.=20 Idun Pharmaceuticals a biotech near La Jolla Village Drive that has 67=20 employees had its power cut for about 40 minutes Tuesday. Though the compa= ny=20 has a back-up generator some segments of its laboratories and lab equipmen= t=20 were not supported by it. Chemists also had to turn off some sensitive lab= =20 equipment to avoid the possibility of a damaging power surge once the=20 blackout was over.=20 We're not in a position as a small company to back up the whole facility= =20 said Steven Mento Idun's chief executive. We haven't done a survey yet to= =20 determine whether we had losses either in experiments or equipment damaged= =20 -- but we're hoping because the blackout was so short that damage will be= =20 minimal.=20 Mento said rolling blackouts coupled with continuing high energy costs=20 could cripple many small biotechs -- and even take a bite out of bigger mo= re=20 established companies.=20 We generate new compounds in controlled environments on a daily basis and= =20 when power goes off you can lose samples because of contamination and other= =20 issues Mento said. We are fortunate that our losses would be in having t= o=20 repeat an experiment -- but this could be really critical for companies wit= h=20 drug manufacturing and issues of quality control.=20 The wireless firms along Sorrento Valley have not been immune from blackout= s.=20 The lights went out at Qualcomm early this week although executives declin= ed=20 to comment about the impact.=20 No blackouts hit the big shipbuilding operations on the waterfront this wee= k.=20 But the National Steel and Shipbuilding Co. -- one of San Diego's largest= =20 employers -- already experienced a voluntary loss of power this year its= =20 first since World War II. Since the shipyard does not have its own power=20 supply NASSCO executives fear the effect of unplanned outages.=20 Our average payroll totals half a million dollars a day said NASSCO=20 spokesman Jim Scott. When you have a day's work disrupted that can be=20 pretty serious. We're currently in discussions about the possibility of=20 buying from independent power suppliers or setting up a power plant of our= =20 own.=20 Small businesses which constitute the bulk of employment in San Diego=20 County were hurt by disruptions as well -- costing them vital revenue at a= =20 time when their power bills have skyrocketed.=20 At Fantastic Sam's a hair salon in Chula Vista Angelica Alcala estimated= =20 that business dropped 60 percent when the blackouts hit Tuesday. Among othe= r=20 things Alcala had to alter her planned haircuts because she was relying on= =20 scissors instead of electric clippers.=20 At the Family Fun Center in El Cajon the management gave vouchers or refun= ds=20 to the 15 or so video-game players who were in the midst of killing aliens = or=20 fighting ninja warriors as the power went down.=20 Papa John's Pizza estimates that it may have lost several thousand dollars = in=20 business after six stores were blacked out Monday and four others lost powe= r=20 Tuesday. Brian Mills who runs 23 Papa John's stores in the county said hi= s=20 main concern was shutting down the computers so they would not be damaged b= y=20 a power surge when the electricity was restored.=20 Paul Ecke III a member of the West Coast advisory panel for the Federal=20 Reserve said the potential impact of the energy crisis is worse than any= =20 downturn in the stock market.=20 Ecke who runs the Paul Ecke Ranch flower operation in Encinitas said the= =20 crisis could be particularly harmful for the state's agricultural sector= =20 since farmers need electricity to pump water and natural gas to heat=20 greenhouses.=20 What I'm really worried about is the energy thing is going to cast a shado= w=20 on California he said. If you're a business person thinking about moving= =20 to California right now you're probably not going to do it because you're= =20 not sure you're going to have your lights on this summer.=20 Besides the disruption to businesses the energy crisis is also hurting the= =20 pocketbooks of hourly workers who have been sent home during the crisis.=20 Under state law employers are free to send hourly workers home without pay= =20 during such emergencies although salaried workers must still be paid.=20 Susan Kemp an attorney with the California Chamber of Commerce said there= =20 are ways of minimizing the impact on hourly workers.=20 You have to look at what time it is when the blackout occurs and how long= =20 you think it's going to last Kemp said. If it's around a meal time you= =20 might send the workers out for a longer meal period if you think it's going= =20 to be an hour or hour and a half delay.=20 But the potential for losing wages doesn't sit well with the hourly workers= .=20 When you get sent home early and lose your wages you have even less money= =20 to pay your inflated energy bills said an hourly worker who was sent home= =20 during Monday's blackout.=20 --- ---------- Out-of-state generators question power regulators' authority=20 By Karen Gaudette ASSOCIATED PRESS=20 March 22 2001=20 SAN FRANCISCO =01) At least three major out-of-state electricity generators= are=20 challenging the authority of the California Public Utilities Commission to= =20 investigate whether they deliberately reduced power supplies to drive up=20 prices.=20 The PUC has asked for power plant maintenance records as it tries to=20 determine whether Duke Energy Dynegy Inc. Mirant Corp. and other=20 wholesalers have manipulated the energy market at California's expense.=20 At issue is who ultimately controls oversight of in-state plants that provi= de=20 most of California's electricity. The plants once owned by the state's=20 largest utilities were sold off as part of the state's 1996 attempt at=20 deregulation.=20 Report says power wholesalers overcharged California $5.5 billion=20 Disappearing state surplus sparks alarm=20 Outages darken economic outlook in state some say=20 Allegheny Energy makes big California connection=20 Enron stock slides despite earnings reassurance=20 California's electricity crisis at-a-glance=20 ?=20 PUC President Loretta Lynch said the public deserves to know whether=20 generators have unnecessarily taken plants off-line to create artificial=20 shortages forcing the utilities and now state bureaucrats to buy much high= er=20 priced power on the spot energy market.=20 What I do know is we have historically high levels of outages across the= =20 board Lynch told The Associated Press. Dynegy and Duke have been fightin= g=20 the PUC in the PUC's quest to obtain documents about these outages.=20 The PUC has the authority to regulate facilities within its borders she=20 added. It doesn't matter where the headquarters of the company is.=20 Duke based in North Carolina says it does matter =01) and that since it a= nd=20 other wholesalers aren't headquartered in California the PUC can't require= =20 it to turn over the maintenance records.=20 We have not given them proprietary information because they do not regulat= e=20 us said Duke's spokesman Tom Williams.=20 Dynegy did not return calls for comment Wednesday.=20 The PUC also faces a new challenge in the legislature. A bill sponsored by= =20 Assemblywoman Carole Migden D-San Francisco which would have granted the= =20 PUC greater inspection authority over out-of-state generators was amended= =20 this month to grant the authority to Independent System Operator instead.= =20 The ISO has managed the delivery of energy through most of the state's powe= r=20 grid but historically has done little regulating and has had no policing=20 authority.=20 This board created during the state's 1996 attempt at deregulation was=20 redesigned in January. Now it has a five-member board appointed by Davis= =20 replacing a 26-member ISO board composed of utility executives marketers= =20 power plant owners and others.=20 The latest version of Migden's bill requires wholesalers to report monthly = to=20 the ISO about any plants that are off-line or working at reduced capacity= =20 and gives the ISO power to audit these reports.=20 But because the ISO board historically has made key decisions behind closed= =20 doors and is exempt from certain open-government regulations government=20 watchdogs are outraged by the switch.=20 The PUC's been no friend of ratepayers but at least under the constitutio= n=20 and state law they're required to conduct their process in the open and the= =20 public can intervene said Harvey Rosenfield of the Foundation for Taxpaye= r=20 and Consumer Rights.=20 Davis ordered last month that the ISO take the lead among state agencies to= =20 ensure adequate energy supplies. Alan LoFaso an aide to Migden said the= =20 amendment follows Davis' lead.=20 Both LoFaso and the governor's spokesman Steve Maviglio downplayed the=20 change. I don't know if we have a preference as to which state agency get= s=20 the authority to continue the probe Maviglio said.=20 The challenge by Duke Energy Houston-based Dynegy Inc. and Mirant Corp. of= =20 Atlanta came in filings March 12 asking for a rehearing of the PUC's Februa= ry=20 resolution reasserting its legal authority to examine the books accounts= =20 memoranda contracts and records of generators selling energy to utilities= =20 already subject to PUC regulation.=20 Those utilities include Pacific Gas and Electric Co. and Southern Californi= a=20 Edison Co. which have been nearly bankrupted buying power from wholesalers= =20 as well as the financially troubled San Diego Gas and Electric -- Allegheny Energy makes big California connection=20 ASSOCIATED PRESS=20 March 22 2001=20 HAGERSTOWN Md. =01) Allegheny Energy Inc. said Thursday it has agreed to s= ell=20 $4.5 billion worth of power to California's electricity-purchasing agency= =20 over the next 10 years.=20 The company said the contract call for Allegheny to provide up to 1000=20 megawatts that the Hagerstown-based company has secured from western=20 generating plants through its new energy trading division Allegheny Energy= =20 Global Markets =01) formerly Merrill Lynch Global Energy Markets.=20 This is a win-win for both the state of California and Allegheny Energy. I= t=20 provides a long-term source of fixed-price energy and should help to=20 stabilize prices in California said Michael P. Morrell president of the= =20 Allegheny Energy Supply division.=20 --- ----------- Judge Frees Small Firm From Edison Contract=20 By KEN ELLINGWOOD and DAN MORAIN Times Staff Writers=20 ?????EL CENTRO--California's balance of electrical power shifted slightly= =20 Thursday when an Imperial County judge temporarily freed a small geothermal= =20 energy producer from its contract with Southern California Edison allowing= =20 it to sell power on the open market. ?????The ruling by Superior Court Judge Donal B. Donnelly could lead to a= =20 mass exodus by hundreds of small energy producers that have been selling=20 power to the state's financially troubled utilities for months without=20 getting paid. ?????At the same time it may have staved off plans by a group of the small= =20 generators to send Edison into involuntary bankruptcy as early as today. ?????In Sacramento energy legislation pushed by Gov. Gray Davis passed in= =20 the state Senate but foundered in the Assembly. The measure was intended to= =20 ensure that the state gets repaid for the electricity that it has been buyi= ng=20 on behalf of Edison and Pacific Gas & Electric which say they lack the cas= h=20 and credit to purchase power. The bill also was supposed to guarantee that= =20 the small alternative energy producers--which together provide nearly a=20 third of the state's power--get paid. But Assembly Republicans opposed it= =20 saying it hadn't been given sufficient scrutiny. ?????The impact of the small producers was made clear in Imperial County= =20 where Edison's failure to pay CalEnergy the county's biggest property=20 taxpayer had outsize implications. CalEnergy had put county officials on= =20 notice that it was about to miss a $3.8-million property tax payment. The= =20 uncertainty had prompted the tiny Calipatria Unified School District to=20 postpone a bond issue for badly needed school repairs. ?????Among CalEnergy Chairman David Sokol's first acts after the judge's=20 ruling Thursday was to promise Imperial County Supervisor Wally J. Leimgrub= er=20 that the company would pay its property taxes on time. ?????That is great news Leimgruber said. ?????Within hours of its court victory CalEnergy had stopped transmitting= =20 geothermal power to Edison and begun selling it to El Paso Energy a=20 marketing company that purchased the energy at prevailing rates and resold = it=20 on the spot market. ?????Some of the more than 700 other small energy producers in the state sa= id=20 they were considering similar action against Edison and Pacific Gas &=20 Electric. ?????We absolutely need the right to sell to third parties said Dean=20 Vanech president of Delta Power a New Jersey company that owns five small= =20 gas-fired plants in California and is owed tens of millions of dollars by= =20 Edison. ?????Sokol praised the Imperial County judge and said his company simply=20 wanted the authority to sell its power to a credit-worthy company that in= =20 fact pays for the power. ?????An Edison spokesman said the company was disappointed with the ruling= =20 but sympathized with CalEnergy and other small producers because=20 California's power crisis has placed [them] in financial distress just as= =20 it has placed utilities in financial distress. ?????Edison expressed concern that the ruling would prompt CalEnergy and=20 other small producers to sell their power out of state. Sokol said CalEnerg= y=20 had specifically told El Paso Energy that it hoped its power would remain i= n=20 California but if someone wants to pay a higher price out of state we=20 can't stop them. ?????Sokol said that Edison still owes CalEnergy $140 million and that the= =20 company--along with seven other small producers--had been prepared to file = a=20 petition in federal bankruptcy court in Los Angeles today forcing the utili= ty=20 into involuntary bankruptcy. He said his company no longer intends to do so= =20 and he believed--but wasn't certain--that the other companies would shelve= =20 their plans. ?????Edison filed papers Thursday with the federal Securities and Exchange= =20 Commission showing that it owed $840 million to various small electricity= =20 producers many of which rely on renewable energy sources such as geotherma= l=20 steam solar energy or wind. ?????The alternative energy producers--and utilities--strenuously objected = to=20 the legislation considered in Sacramento on Thursday. The bill spelling ou= t=20 how the utilities are to pay the state and the small producers passed the= =20 Senate on a 27-9 vote the exact two-thirds margin required. But it stalled= =20 in the Assembly on a 46-23 party-line vote well short of two-thirds. ?????When I was a citizen back in Lancaster I heard these stories about= =20 pieces of legislation that were cooked up late at night that . . . were cu= t=20 and pasted together and were rammed through by the Legislature Assemblyma= n=20 George Runner (R-Lancaster) said. That's exactly what we have before us. ?????The alternative electricity generators including oil companies warne= d=20 that they would lose money under the Davis proposal while representatives = of=20 Edison and PG&E which have amassed billions in debt in the worsening energ= y=20 crisis said the legislation would push them deeper into the hole. ?????There isn't enough money Edison attorney Ann Cohn testified at a=20 Senate hearing on the bill Thursday. It is a very simple question: Dollars= =20 going out cannot be greater than dollars coming in. ?????The bill AB 8X combined several proposals. First it sought to clari= fy=20 earlier legislation by spelling out that Edison and PG&E must pay the state= =20 all money collected from consumers for electricity that the state has been= =20 buying. ?????Additionally the bill would turn over to the California Public=20 Utilities Commission the thorny issue of how much to pay alternative energy= =20 producers for their electricity. ?????Wind solar and geothermal producers might agree to the prices offered= =20 by the administration. But most of the alternative energy producers=20 including Chevron and British Petroleum use natural gas to generate=20 electricity through cogeneration a process of creating steam for both=20 electric generation and heat. With natural gas prices high they contend= =20 they would lose money at the prices Davis is offering. ---=20 ?????Ellingwood reported from El Centro Morain from Sacramento. Times staf= f=20 writers Mitchell Landsberg in Los Angeles and Jenifer Warren Nancy Vogel a= nd=20 Carl Ingram in Sacramento contributed to this story. --- ------------------- Lodi Defies Order for Blackouts=20 Utility tells PG&E to 'pay the bills'=20 Alan Gathright Chronicle Staff Writer Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N171303.DTL=20 Let history show that the rebellion against rolling blackouts started when= =20 the Central Valley town of Lodi defied PG&E and refused to unplug its=20 customers this week.=20 Like several cities that own their own utilities Lodi saw the energy crunc= h=20 looming last fall and spent millions for long-term power contracts in an=20 attempt to avoid blackouts.=20 Now Lodi and a Northern California municipal utility cooperative that=20 includes Palo Alto Santa Clara and Alameda are telling Pacific Gas and=20 Electric Co. that it's unfair to force their customers to endure blackouts= =20 triggered by the near-bankrupt utility's failure to pay its debts.=20 The problem is not paying bills so pay the bills said Alan Vallow=20 director of the utility serving Lodi's 58000 residents. I won't arbitrari= ly=20 screw my customers . . . so 5000 PG&E customers can turn on their lights= =20 somewhere else.=20 When PG&E relayed an order from state power regulators Monday and Tuesday f= or=20 Lodi to black out some of its customers a strategy intended to keep the=20 West's power grid from collapsing Lodi said no.=20 So far other cities in the Northern California Power Agency say they will= =20 continue to participate in rotating outages.=20 But in a letter last Friday to PG&E members of the agency and four other= =20 utility districts including Sacramento's warned they didn't believe long-= =20 standing agreements that allow them to use PG&E transmission lines to conne= ct=20 to the grid obliged them to endure rolling blackouts because of PG&E's=20 failure to pay its power obligations.=20 They say the agreements require them to reduce power demand only in respons= e=20 to natural disasters or malfunctions damaging power lines or plants.=20 The agencies asked for a meeting with PG&E President Gordon Smith before=20 anticipated summer blackouts hit to develop a more rational program for= =20 allocation of risks associated with (power demand) load shedding before you= =20 call on us to participate in load shedding again.=20 REFUSING TO SHARE BURDEN PG&E officials accused Lodi of selfishly refusing to share the burden of th= e=20 statewide energy crisis.=20 It is regrettable that after reaping the benefits of the (power grid)=20 interconnection contract for many years Lodi is suddenly unwilling to bear= =20 their share of the burden of the statewide energy crisis said PG&E=20 spokesman Ron Low. When cities like Lodi do not follow the (state=20 Independent System Operator's) order to curtail power it hurts all of=20 California and jeopardizes the entire power grid.=20 Low also disagreed with accusations that this week's blackouts were trigger= ed=20 by PG&E's failure to pay its bills noting that the ISO stated that 12000= =20 megawatts of power were offline because of plant maintenance.=20 But ISO spokeswoman Lisa Szot confirmed assertions by the municipal utiliti= es=20 that power generators had kept an additional 3000 megawatts offline becaus= e=20 they feared PG&E couldn't pay.=20 Lodi's Vallow said he was legally obliged to serve city customers. Lodi=20 residents are facing rate increases of as much as 15 percent under a power= =20 contract that the city secured in hopes of avoiding blackouts. The contract= =20 required Lodi to pay a $10 million premium above its typical $23 million=20 annual energy bill.=20 'THAT'S NOT FAIR'=20 I've been hearing (PG&E say) 'Gee that's not fair. Where's the equity if= =20 everybody is doing rolling blackouts and you're not?' Vallow said. Well= I=20 put my customers at financial risk to the tune of $10 million. And if they'= re=20 not going to get to use that power they paid for then by God give us that= =20 money back.=20 Vallow said he was willing to sell PG&E some of Lodi's power surplus knowi= ng=20 Lodi might not be paid.=20 But I'm not willing to turn off 5000 customers so 5000 customers=20 somewhere else can turn their lights on Vallow said. The objective here= =20 people is to keep as many lights on as possible.=20 Other city-owned utilities while annoyed with the rolling blackouts aren'= t=20 going as far as Lodi.=20 WEATHERING BLACKOUTS I certainly understand the frustrations of utilities like Lodi and actuall= y=20 share those frustrations in many cases said John Roukema assistant=20 director of Santa Clara's utility.=20 But he stressed that his agency had been able to weather blackouts without= =20 hurting residents or small business because 17 major industrial power user= s=20 had agreed to curtail demand during energy alerts.=20 The prudent thing to do at this time is to continue to do our share and=20 participate in rolling blackouts because a single problem could cause a=20 catastrophic failure in the statewide system Roukema said.=20 In Alameda residents endured blackouts this week despite the fact that cit= y=20 has secured reliable power supplies said Matt McCabe spokesman for Alamed= a=20 Power & Telecom.=20 It was in the best of interests of Alamedans to maintain the stability and= =20 integrity of the grid he said. Now if it becomes evident that the syste= m=20 is being jeopardized for financial reasons then we should not have to=20 subject Alamedans to rolling blackouts.=20 In Palo Alto which also had blackouts this week utility officials told th= e=20 City Council they were expecting a 30 to 40 percent rate hike this spring t= o=20 pay new contracts guaranteeing a stable power supply said Councilman Bern= =20 Beecham. The city hopes to avoid giving customers the double whammy of rate= =20 boosts and more blackouts with a program that gets industrial users to cut= =20 demand voluntarily during alerts.=20 When there's not enough generating capacity in the state to protect the=20 integrity of the grid that is in fact everybody's problem Beecham said= =20 but that doesn't mean Palo Alto is willing to endure blackouts to prop up= =20 PG&E's ailing finances.=20 We need to have some very frank discussions with PG&E about mutual=20 obligations Beecham said.=20 Energy Tips=20 With Californians facing electricity and natural gas shortages PG&E has=20 several tips to help conserve both:=20 -- Set the furnace thermostat at 68 degrees or lower health permitting.=20 -- Wash only full loads in a dishwasher. If operating instructions allow= =20 turn dishwasher off before the drying cycle and let dishes dry naturally.= =20 -- Use low-wattage or fluorescent lights.=20 -- Fix defective plumbing and dripping faucets which waste water and=20 increase the gas or electric bill for heating the water.=20 -- Plug gaps around pipes ducts fans and vents that go through walls=20 ceilings and floors.=20 -- Keep furnaces clean and clean or replace the filter regularly.=20 -- Turn heaters down when using a fireplace and close the damper when not= =20 using the fireplace.=20 -- On sunny days open drapes on windows facing south and let the sun shine= =20 in. At night close the drapes to retain indoor heat.=20 Source: www.pge.com=20 E-mail Alan Gathright at 2001 San Francisco Chronicle ? Page?A - 1=20 --- Coming Down to the Wire=20 State legislators battle over alternative energy bills=20 Greg Lucas Robert Salladay Chronicle Sacramento Bureau Friday March 23 2001=20 2001 San Francisco Chronicle=20 URL:=20 /23/M N113351.DTL=20 Sacramento -- After several weeks of slow to no progress in attacking the= =20 state's energy mess the Legislature erupted yesterday into a frenzy of=20 energy activity.=20 The sudden action on a series of energy bills -- including one to let=20 businesses buy power directly from generators -- stemmed initially from the= =20 fear of bad publicity lawmakers might receive for a planned three-day junke= t=20 next week to Washington D.C.=20 When a key bill bogged down in the Assembly late yesterday Speaker Bob=20 Hertzberg D-Sherman Oaks announced the trip was canceled.=20 Another reason for the flurry of action was recognition that time is runnin= g=20 out.=20 Several alternative energy producers -- like wind farms and biomass plants = -=20 - said they were one day away from forcing the state's two biggest utilitie= s=20 into bankruptcy because they were owed more than $1 billion.=20 The Legislature's action and a court ruling that could free alternative=20 producers from unpaid contracts.=20 This is triage members of the Senate said Sen. Jim Costa D-Fresno. Th= is=20 is crisis activity we're engaged in.=20 The Senate approved a bill aimed at helping state regulators get cash to so= me=20 alternative energy producers. Most of them have been paid little or nothing= =20 since November by the utilities they sell electricity to.=20 Senators passed a bill to help the Public Utilities Commission order=20 utilities to pay solar wind and other alternative energy producers who sig= n=20 lower-priced contracts with the utilities.=20 The bill failed in the Assembly because of GOP opposition fanned in part b= y=20 price concerns by the oil industry a major co-generation producer. The=20 Assembly is set to meet again today to try again pass the bill which the P= UC=20 needs to issue its final order.=20 The PUC's proposed order offers the first hint of financial relief for=20 hundreds of alternative energy producers known as ''qualified facilities = in=20 the energy industry who have been paid just pennies on the dollar by cash-= =20 strapped Pacific Gas & Electric and Southern California Edison.=20 Lack of payments has caused many alternative generators to shutter their=20 operations.=20 The PUC's proposal which will be considered at the commission's meeting=20 Tuesday offers generators a choice of agreeing to a five-year contract at= =20 $79 per megawatt or a 10-year deal at $69 per megawatt Davis said. The goi= ng=20 rate now is about $150 a megawatt hour.=20 The order does not address money already owed to the more than 600=20 alternative energy producers.=20 Under the order utilities would have to pay any generator who signed the n= ew=20 contracts within two weeks.=20 But PG&E said it might not be able to afford do that.=20 Operators of co-generation facilities say the contracts contemplated by the= =20 PUC don't cover their cost of producing energy because the sale price no=20 longer would be pegged to the the price of natural gas.=20 In a significant court decision affecting generators one geothermal energy= =20 supplier in Imperial County won a lawsuit yesterday against Edison allowing= =20 the company to escape a contract requiring it to sell electricity to the=20 utility.=20 A superior court judge said CalEnergy operator of the geothermal plant=20 could suspend deliveries to Edison and sell the 268 megawatt hours it=20 generated on the open market.=20 CalEnergy is owed $75 million by the utility.=20 The court victory may ease mounting pressure from some qualified facilities= =20 including CalEnergy to drive one or both of the utilities into involuntary= =20 bankruptcy.=20 The Assembly and Senate meanwhile rushed through a series of bills aimed = at=20 increasing energy conservation and rushing the building of new power plant= s.=20 Most significant for bigger residential and commercial utility customers is= a=20 measure passed by the Assembly to allow energy customers to buy power=20 directly from generators.=20 That right was eliminated in January when the state began buying power for= =20 the cash-strapped utilities.=20 The bill approved unanimously yesterday would impose a yet to be determined= =20 exit fee on customers who leave the power grid to help cover the state's=20 financial exposure.=20 Tell Us What You Think=20 Can you save 20 percent on your energy use? Gov. Gray Davis' administration= =20 is offering rebates for Californians who save on power starting in June an= d=20 if you've got a strategy for conserving The Chronicle wants to hear it.=20 We'll be writing about the hardest-working energy savers in a future story.= =20 To get involved write to the Energy Desk San Francisco Chronicle 901=20 Mission St. San Francisco CA 94103 or e-mail energysaver@sfchronicle.com= .=20 E-mail the reporters at glucas@sfchronicle.com and bsalladay@sfchronicle.co= m.=20 2001 San Francisco Chronicle ? Page?A - 14=20 --- State's bill for energy could double this year=20 Posted at 9:34 p.m. PST Thursday March 22 2001=20 BY=20 STEVE=20 JOHNSON=20 AND=20 JOHN=20 Warning that California is imperiled by the prices it is paying for=20 electricity a report Thursday said the state's annual power tab could wind= =20 up being 10 times what it was two years ago.=20 At the current rate of spending the report estimated that the total=20 electricity bill in California this year could hit $70 billion which is mo= re=20 than twice what it was last year and about 10 times what was paid in 1999 a= nd=20 1998.=20 ``The California electricity market has gone from being `dysfunctional' to= =20 precipitating a crisis'' according to the report from the Independent Syst= em=20 Operator.=20 It added that the price being charged ``threatens any semblance of just and= =20 reasonable consumer rates the financial viability of California's=20 investor-owned utilities the financial stability of California of its=20 neighboring states and of the nation.''=20 While power suppliers denied any wrongdoing the report said the state=20 appears to have been hit with ``excess'' charges totaling $6.87 billion sin= ce=20 May based on an assessment of the typical operating costs of power plant= =20 owners. Out of that total $6.2 billion appeared to be excessive charges=20 during times when power was not in particularly short supply the agency=20 said.=20 The cost of power has become a growing concern now that the state has stepp= ed=20 in to buy it on behalf of Pacific Gas & Electric Co. and Southern Californi= a=20 Edison which claim to be so strapped for cash that they are on the verge o= f=20 bankruptcy.=20 In making public the report which was sent to the Federal Energy Regulator= y=20 Commission officials at the Independent System Operator were careful not t= o=20 accuse any power companies of price gouging. While the prices appeared to b= e=20 unreasonable they said the state needs to learn more about the specific= =20 operating costs of power plant operators before they could determine whethe= r=20 California was cheated.=20 The officials said they were considering asking the federal agency which= =20 oversees power wholesalers to order the suppliers to make refunds. In the= =20 past two weeks the federal agency has warned a number of suppliers that th= ey=20 may have to refund $135 million in apparent overcharges during January and= =20 February.=20 But many experts question whether the federal agency is serious about=20 demanding such refunds so California officials also are reviewing the=20 possibility of suing the suppliers or seeking criminal charges against some= =20 of them. ``We're working very closely with a number of agencies to review t= he=20 information we currently have to determine what remedies may be available'= '=20 said Charles Robinson the Independent System Operator's general counsel.= =20 The report's suspicions were partly bolstered by another study made public= =20 Thursday by the state auditor. It said California's market structure=20 encouraged bidding gamesmanship by both utilities and power sellers ``in an= =20 effort to manipulate wholesale prices to their advantage.'' But it stopped= =20 short of accusing power generators of profiting illegally.=20 ``There's clearly some evidence of market abuse'' said state Auditor Elain= e=20 Howle. Even so she added ``that's not to say it's anything illegal. We=20 hired consultants they looked at some of the bidding and they weren't=20 comfortable going that far.''=20 Although no power companies were named in either report officials with=20 several suppliers insisted they have done nothing wrong.=20 ``We've conducted our business legally and ethically'' said Richard=20 Wheatley spokesman for Reliant Energy which runs five major California=20 power plants. ``The ISO report appears to be nothing more than just another= =20 attempt to put blame at someone else's doorstep when there's been very=20 little action out of Sacramento to resolve the problems in the California= =20 marketplace.''=20 Duke Energy spokesman Jeremy Dreier said the company which runs plants in= =20 Moss Landing and Morro Bay sold most of its power last year and this year = in=20 relatively low-cost long-term contracts and was among the first to offer= =20 such deals to the state. He added that Duke increased production from its= =20 aging plants to meet surging demand.=20 ``The fact that we were among the first to bring long-term contracts to the= =20 table speaks volumes about how we're trying to serve this market'' Dreier= =20 said.=20 John Sousa of Dynegy Inc. which co-owns three major California plants add= ed=20 that ``given the market conditions the rates we charged were just and=20 reasonable.''=20 --- Plan for alternate power plants stalls=20 Posted at 10:03 p.m. PST Thursday March 22 2001=20 BY DION NISSENBAUM AND JENNIFER BJORHUS=20 Mercury News=20 SACRAMENTO -- The state's prospects for plugging a critical electricity gap= =20 dimmed Thursday when the state Assembly rejected a rescue plan for=20 alternative power companies and a state judge ruled that one such firm coul= d=20 stop selling energy in California.=20 Both actions threaten the plan Gov. Gray Davis announced just Tuesday to ke= ep=20 these companies running and stave off more blackouts. With the state's=20 troubled utilities failing to pay for their electricity many alternative= =20 energy plants have been shutting down.=20 The dual blows came on a day when tempers flared in the Capitol as lawmaker= s=20 jarred by back-to-back blackouts launched bipartisan attacks on Pacific Gas= &=20 Electric Co. and Southern California Edison which aren't paying wind sola= r=20 biomass geothermal and small gas-fired plants for their electricity.=20 After Republicans shot down the measure meant to keep alternative energy=20 companies in business Assembly Speaker Robert Hertzberg D-Van Nuys warne= d=20 that the restless companies might act on their threat to force the utilitie= s=20 into bankruptcy.=20 ``They said it and I understood them to mean it'' he said.=20 The failure overshadowed a burst of action in Sacramento where lawmakers=20 approved a host of other measures. The Senate approved two key bills: one= =20 that would spend more than $1 billion to encourage Californians to conserve= =20 energy and one that would make it easier to build power plants. The Assembl= y=20 approved 14 incremental bills.=20 Six votes short=20 But the Assembly fell six votes short of passing a hastily prepared bill=20 meant to help prop up the nearly 700 alternative energy companies many of= =20 which are now idle.=20 Those closings sapped California of energy this week and helped cause two= =20 days of rolling blackouts -- the first since January.=20 In response Davis and lawmakers cobbled together a plan to set new lower= =20 rates for alternative power and to fine the utilities if they refuse to pay= =20 these companies which supply up to a third of the state's power.=20 But Republicans refused to back the measure and said it contained too many= =20 complex parts that needed more time to analyze.=20 ``Everyone in this room knows that this piece of legislation has not had a= =20 good look'' said Assemblyman George Runner R-Lancaster.=20 Assemblyman Fred Keeley D-Santa Cruz castigated the Republicans and=20 implored them to accept an imperfect solution.=20 ``Ladies and gentlemen: Welcome to the NFL'' he said. ``Welcome to the wor= ld=20 where large complex issues don't have a simple solution.''=20 Approval is needed before state regulators at the Public Utilities Commissi= on=20 can vote on the fine points of the plan. That was supposed to happen Tuesda= y.=20 Much of the criticism focused on concerns raised by power plants that use= =20 natural gas to produce energy. Administrators from those plants said the=20 Davis price caps would make it impossible for them to break even.=20 The derailment came hours after the measure narrowly won approval in the=20 state Senate.=20 Hertzberg plans to search for a compromise today and canceled plans for the= =20 Assembly's annual trip to Washington.=20 Thursday's actions were highlighted by angry attacks on the utilities by=20 frustrated lawmakers.=20 ``I hope they do go bankrupt'' shouted Senate President pro tem John Burto= n=20 D-San Francisco during a debate on the energy crisis. ``Let them go belly= =20 up. I don't care any more.''=20 Legal decision adds twist=20 The legislative failure was compounded by a legal decision in Southern=20 California that further complicated the picture.=20 A Superior Court judge in Imperial County cleared the way for CalEnergy=20 Operating Corp. to break its contract with Edison and sell its 268 megawatt= s=20 of power on the open market. The judge concluded that Edison had breached i= ts=20 contract by failing to pay CalEnergy since November.=20 That ruling could pave the way for hundreds of others to follow suit and=20 drain off power California needs to prevent blackouts.=20 ``It's not good'' said V. John White director of the Center for Energy=20 Efficiency and Renewable Technologies. ``This is potentially going to chang= e=20 the dynamics of the situation and probably not for the better.''=20 Jan Smutny-Jones executive director of the Independent Energy Producers=20 Association said it was unclear whether other companies would sue.=20 ``I think this is a very significant development'' he said. ``We're sort o= f=20 at a period where the industry's reaching the end of the rope.''=20 The ruling did have one silver lining: CalEnergy Chairman David Sokol said= =20 his company and seven others had planned to force Edison into bankruptcy if= =20 they lost in court.=20 But he also warned ``You stick a sharp stick in enough people's eyes and= =20 they get pretty tired of it.''=20 The situation with generators supplying PG&E isn't as dire since the compan= y=20 has been making partial payments.=20 Kent Burton senior vice president for Covanta Energy Corp. in New Jersey= =20 said ``They've tried to be responsive.''=20 Mercury News Staff Writer Mark Gladstone contributed to this report. Contac= t=20 Dion Nissenbaum at dnissenbaum@sjmercury.com or (916) 441-4603 or Jennifer= =20 Bjorhus at jbjorhus@sjmercury.com or (408) 920-5660. | other | urgent | 5 |
Re: Dereg Articles | yes Mark Palmer@ENRON 09/26/2000 08:51 AM To: Steven J Kean@EES James D Steffes/NA/Enron@Enron cc: Subject: Dereg Articles Should we ask the guy that did the deal with Champion Paper to write a response? | other | casual | 3 |
Re: Contribution to Sacramento Womens Campaign Fund | Let's process this request. I think it's justified. ----------------- | government & politics | formal | 3 |
Re: Return of Confidential Materials | Jeff. I have no docs on this transaction. Thus have nothing to destroy. Michelle | legal affairs | casual | 1 |
null | Joe - there is no announcement today. I tried to leave you a voicemail but apparently the system is down there. Before we can offer an outside person a VP position the Executive Committee must sign off. We are going to be going through that process in a few minutes. Then we begin the offer extension and negotiations. The person we are recommending is Linda Robertson one of the two people I mentioned to you before. Please guard the information carefully. Last time we talked when the list had been narrowed to two DeLay's office called with the exact two names and started pushing us to hire a Republican. As you know we interviewed candidates of both political affiliations and just settled on the best person. Ken told DeLay's office that's how we do things and Ken is comfortable (actually enthused) about the choice. When some external announcement is done you will be involved and your considerable contributions will be prominently mentioned. | other | confidential | 3 |
RE: Confidential - Decision tree on projects | We will discuss at the next Staff meeting. Thanks for bringing it up. Any= feedback from the floor meeting yesterday would be appreciated. | project management | formal | 3 |
Re: NEW DRAFT OF ENRON STATEMENT | I know we are holding for a later filing but I have attached further comments anyway. The document is still too rough to send out. We need to take the opportunity as soon as possible to get a hard hitting thoroughly researched and carefully written document in front of the Commissioners. California's reaction to the Judge's recommendation is likely to give FERC (especially the new commissioners) a feel for how irrational the California politicians can be. We will have a limited opportunity to take advantage of that realization. We need to hit it hard in the pleading our conversations at the Commission the Hill and the media. Linda Robertson 07/09/2001 09:58 AM To: James D Steffes/NA/Enron@Enron cc: Alan Comnes/Enron@EnronXGate Carole Hodge/ETOL/EU/Enron@ETOL dwatkiss@bracepatt.com Jeff Dasovich/NA/Enron@ENRON Richard B Sanders/Enron@EnronXGate Richard Shapiro/NA/Enron@ENRON Robert Frank/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Steven J Kean/NA/Enron@ENRON Susan J Mara/NA/Enron@ENRON Subject: Re: NEW DRAFT OF ENRON STATEMENT Let me emphasize that these comments are to be filed COB TODAY. James D Steffes 07/09/2001 10:50 AM To: Robert Frank/NA/Enron@Enron Steven J Kean/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Linda Robertson/NA/Enron@ENRON Sarah Novosel/Corp/Enron@ENRON Carole Hodge/ETOL/EU/Enron@ETOL Richard B Sanders/Enron@EnronXGate dwatkiss@bracepatt.com Alan Comnes/Enron@EnronXGate Susan J Mara/NA/Enron Jeff Dasovich/NA/Enron@Enron cc: Subject: NEW DRAFT OF ENRON STATEMENT HERE IS THE MOST RECENT STATEMENT WITH STEVE'S COMMENTS. Jim | other | urgent | 5 |
null | Here it is | other | casual | 0 |
Re: October London meeting | Attached is a draft of the Agenda we discussed. Irwin - I show Joskow on here but he has already declined (his wife is having surgery right before our meeting date). We may want to consider someone like Seabron Adamson (Frontier Economics) or perhaps someone else. | other | formal | 3 |
Re: call to Sen Kinder | Nice work Kerry and Barb. I think we should do the follow up work on setting a follow up meeting with the Senator. Ken left it open whether he would be available when the Sen is in Houston so we have made no commitment in that regard. Janine Migden 04/27/2001 08:32 AM To: Steven J Kean/NA/Enron@Enron cc: James D Steffes/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Susan M Landwehr/NA/Enron@Enron Kerry Stroup/NA/Enron@Enron Barbara A Hueter/NA/Enron@Enron Subject: Re: call to Sen Kinder Thanks Steve. That's great news. Just as an FYI the memo that Ken worked from was prepared by Kerry Stroup and Barbara Hueter who are the leads on Missouri. As a follow-up will Sen. Kinder be contacting Ken Lay directly or should Kerry and Barbara contact Sen. Kinder's office as the date gets closer to make arrangements? Please advise. Thanks Janine Steven J Kean 04/26/2001 08:07 PM To: Susan M Landwehr/NA/Enron@Enron Janine Migden/NA/Enron@Enron cc: Richard Shapiro/NA/Enron@Enron James D Steffes/NA/Enron@Enron Subject: call to Sen Kinder Ken talked to Sen Kinder. He made the points you had prepared. Kinder agreed to shelve the legislation for this session. He said he had been hearing from several others including Proctor and Gamble (which has a big facility in his district) that the legislation was not going to help competition develop in the state. He expressed willingness to work with us on a better package and also expressed interest in coming to Enron's offices. He is going to be in San Antonio in August and would like to come to Houston around that time. | government & politics | formal | 3 |
RE: Cal PUC Subpoenas - confidential attorney client communicatio n | Mike Richard and Gary: What I was suggesting was that we would produce the limited items that we are proposing under the terms of the existing protective order (which are inadequate but we are not giving up any of the crown jewels at this point) while conditioning our production on two points first that we reserve the right to seek stronger protection in the order (a la Williams' motion) for any subsequent materials we do agree to produce or which are compelled to be produced and two that the materials we are currently producing which are entitled to confidentiality (the trading data at a minimum) shall be subject to the most stringent protective order which the Commission issues in this proceeding i.e. we get the benefit of any additional protections Williams can secure. I only suggest this so we can stay out of the limelight by not being one of the bad guy generators who are actively taking on the protective order when we know that at least four generators are producing nothing until their motion is resolved and one marketer (Coral/Shell Energy) has refused to produce transactional data and has objected to most of the document request. I have also recently learned that Calpine has gotten an extension until Oct. 13 and will try to delay and hold off producing much data. I will get getting a copy of Coral's objections to the commission shortly. Mike Day | legal affairs | formal | 3 |
REMOVE | What do you think? If you think this would be useful go ahead and order it. | other | casual | 3 |
Confidential for Dan Watkiss | Jim If you are able to provide this to Dan for the meeting I would appreciate it. He may not want to circulate it to the group. It is intended as a work product for attorney. This e-mail and the attachments were prepared at the request of counsel. <<NOTES FOR DISCUSSION.doc>> Jan Paul Acton Vice President Charles River Associates 1201 F St. NW Suite 700 Washington DC 20004-1204 Voice: (202) 662 3902 Fax: (202) 662 3910 ***** This electronic message contains information from the consulting firm of Charles River Associates Inc. which may be confidential or privileged. The information is intended for the use of the individual or entity named above. If you are not the intended recipient be aware that any disclosure copying distribution or use of the contents of this information is prohibited. If you have received this electronic transmission in error please notify us by telephone (617 425-3582) or by e-mail (postmaster@crai.com) immediately. ***** - NOTES FOR DISCUSSION.doc | other | confidential | 5 |
Re: New Computer for Handling Stock Awards | Do what you need to do the system has to work. The only question I have is: why doesn't IT just take care of this without a charge? This is not an extraordinary item or special request. This ought to be something IT simply takes care of without us having to get involved or pay extra. Am I missing something? From: Aaron Brown/ENRON@enronXgate on 04/16/2001 09:41 AM To: Steven J Kean/NA/Enron@Enron Mary Joyce/ENRON@enronXgate cc: Subject: New Computer for Handling Stock Awards Steve The IT group put it like this...Justification: Current Server is PL1850 and has reached it's capacity and is non-redundant. That means that our current system: (1) has a slow processor (2) is nearly out of memory for stock award administration (3) doesn't have a real-time back up in case the hard drives fails (4) needs to be upgraded The IT group has quoted about $19000 for a new system that brings this server up to Enron's current server standards and takes care of the above issues. Let me know if this expense is a problem and whether you need to be involved with these types of decisions in the future. Thanks Aaron | information technology | frustrated | 3 |
Re: Politics and Enron | The plan was to hit the issue twice -- once in the short format of Ebiz and at greater length in the longer format of the October issue of Enron Business. Please let Paul know. ----------------- | government & politics | formal | 2 |
RE: Jamaica forecast for JMD and inflation, dated 6/25/01 | Gwyn Thanks for this msg and other updates. Vince | other | casual | 0 |
Re: Daily Update/ Legislative activity - 08/24/00 | I agree that we should not be opposing rate caps for small customers and schools but I think we should be pounding on the fact that market participants have been putting offers in front of sdge and that allowing the market to provide this solution is superior to legislated caps that require the creation of huge deferrals (and more problems in the future). Can we make that argument work? Mona L Petrochko 08/24/2000 09:45 PM To: Bruno Gaillard/SFO/EES@EES cc: West GA Edward Hamb/HOU/EES@EES Jennifer Rudolph/HOU/EES@EES Chris Hendrix/HOU/EES@EES Greg Cordell/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Douglas Condon/SFO/EES@EES James M Wood/HOU/EES@EES Gary Mirich/HOU/EES@EES Dennis Benevides/HOU/EES@EES Roger Yang/SFO/EES@EES David Parquet@ECT mday@gmssr.com Paul Kaufman/PDX/ECT@ECT Marcie Milner/Corp/Enron@ENRON Mary Hain@Enron Harry Kingerski/HOU/EES@EES James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Tim Belden/HOU/ECT@ECT Subject: Re: Daily Update/ Legislative activity - 08/24/00 I attended Cmmr. Wood's two-day hearing on Wholesale Markets which concluded today (8/24) in San Diego. Three Commissioner's were present (Wood Lynch and Neeper) with Duque and Bilas participating by phone. Administrative Law Judge Wetzel was present and a transcript was taken. The quasi-legislative hearing was the beginning of a record developed for the investigation into the workings of wholesale/retail markets. This session focused on Wholesale markets. There will be subsequent sessions on retail issues market structure and other related issues in the future. My conclusion from this session is that Wood is looking for support for increasing regulatory intervention in the market. Dan Larcamp Director of the Office of markets Tariffs and Rates FERC was present. He relayed FERC's concern of this matter and a desire to hold hearings in San Diego. He also relayed that Hoecker held a press conference announcing the opening of a 206 investigative proceeding into the operation of the wholesale markets in California which carried with it refund authority. The format of the hearing was to respond to pre-filed questions developed by Wood/Lynch. Each member of the panel would respond to the questions and any questions posed by the Commissioners the Judge or the CPUC Attorney. No questions were posed by members of the audience. Yesterday's panel of academics were comprised of: 1. Dr. Timothy Duane-UC Berkley 2. Dr. William Hogan-Harvard 3. Dr. Frank Wolak-Stanford (ISO Market Surveillance Committee) 4. David Marcus-Energy Consultant for the Coaltion of Utility Employees 5. Dr. Gene Coyle 6. Dr. Jean-Michel Glachant Universite Paris I Pantheon Sorbonne The panel was asked to speak as individuals and not on behalf of any institutions they may represent. While the purpose of the panel seemed to be to determine that market power was being exercised and that prices were too high and therefore not just and reasonable the panelist stopped short of blaming generators and market participants in behaving illegally. The concensus generally was that market power did exist at various times but the mere existence did not constitute bad behavior. None with the exception of Dr. Wolak who is in the process of doing a study using recent data as part of his role for the Market Surveillance Committee had done a study. There was some discussion though not much of the monopsony power of the utilities. I think ultimately the group conceded that scarcity of supply amplified concerns about the exercise of market power as even the increase in gas costs did not fully explain the recent spikes. Wolak believes that encourage utilities to enter into forward purchases will reduce the exercise of real-time market power. Hogan seemed to be there with Sempra's interests in mind. He continued to promote expansion of the ISO's abilities to dispatch load as well as maintain system reliability. There was alot of discussion about forward purchase ability for utilities so as to be less subject to volatile market prices. The concerns were also discussed about the appropriateness of a distribution utility making purchasing decisions on behalf of its customers. This included discussion of separation of these functions and the default provider role. Most everyone agreed that rolling back to a regulated market was not feasible without raising other major and serious concerns however there seemed to be support for some interim measures where cost-of-service regulation may be a good idea and that was during peak periods. All agreed that a demand response and price signals are important in the long-run although not to the extent currently experienced in San Diego. Today's panel included representatives from SDG&E SCE and PG&E TURN UCAN and ORA. While yesterday's panel maintained objectivity as to whether or not generators were exercising market power to the detriment of the system today's panel made no bones about the generators being to blame. SCE/PG&E indicated their need for relief for recovery of market costs in excess of the rate freeze. SDG&E was still on the hot seat for their inaction in hedging any of their supply. SDG&E brought up their failed PBR proposal and ORA and UCAN thought that that may be one way to incent the utility to be more responsible with their purchases. UCAN discussed the Governor's direction and the potential for putting rate caps into affect for residential and small commercial. He mentioned that C&I customers are experience difficulties as well. TURN raised the need for cost-based bid caps and cost-based peaking contracts. Mike Florio TURN urged against any further divestitute of assets and alleged market concentration on those assets that had been divested. In fact TURN urged the Commission to seek legislation to clarify the Commission's authority to order retention of assets. Neeper urged that part of the solution should be changing the current requirement to use the PX as the only authorized exchange although TURN disagreed. Bruno Gaillard 08/24/2000 06:09 PM To: SF Directors Edward Hamb/HOU/EES@EES Jennifer Rudolph/HOU/EES@EES Chris Hendrix/HOU/EES@EES Greg Cordell/HOU/EES@EES Harold G Buchanan/HOU/EES@EES Martin Wenzel/SFO/HOU/EES@EES Douglas Condon/SFO/EES@EES James M Wood/HOU/EES@EES Gary Mirich/HOU/EES@EES Dennis Benevides/HOU/EES@EES Roger Yang/SFO/EES@EES David Parquet@ECT mday@gmssr.com Paul Kaufman/PDX/ECT@ECT Marcie Milner/Corp/Enron@ENRON Mary Hain@Enron Harry Kingerski/HOU/EES@EES James D Steffes/HOU/EES@EES Richard Shapiro/HOU/EES@EES Peggy Mahoney/HOU/EES@EES Karen Denne@Enron Mark Palmer/Corp/Enron@ENRON Steven J Kean/NA/Enron@Enron Tim Belden/HOU/ECT@ECT cc: Subject: Daily Update/ Legislative activity - 08/24/00 Siting related bills 1. Good new - The Williamson Act passed the Senate 34-1 It should be heard at the assembly Saturday or Monday if it is not redirected to a Committee hearing. 2. There was a long meeting with Ducheny with regards to AB 970. The enviro's boycotted they want to draft a bill with Keeley. Labor was obstructionist - they wanted to gut all the expediting siting language with regards to all facilities except for the peaking plants. Rate Cap related bills 1. The Edison Language on Rate Stabilization may not go anywhere. Edison has not found an author because of the efforts of Enron and others lobbying against it. Furthermore there are signs that Gov. Davis opposes it. 2. The Governor's office has issued a proposed language for a rate cap bill. The language however is not available as of yet. It may be released today or tomorrow. SDG&E has shown concerns over the content of the bill. They seem to think that it is worse than initially proposed by the Governor in his press release. The bill includes retroactive rate caps through 6/1/00. The rate cap could reflect Wood's rate cap proposal (6.5 cts cap on the energy component The bill does not specify who or how the costs associated with the cap will be recovered. (The reasoning is that UDCs will be more cautious in their procurement if there is uncertainty on who is responsible for the costs.) All of this is speculative. We hope to see the actual language soon. 3. Enron has been working with the Republican leadership to promote a rate cap proposal similar to the amended language we have proposed for AB2290. The bill focuses only on SDG&E customers and our major principals are the following. The Interim Rate Cap should be limited to residential and small commercial customers plus specific institutions that have a significant public role such as schools and hospitals. The Interim Rate Cap should be limited to the period ending December 31 2001. The Interim Rate Cap must be structured so that any undercollection is eventually recovered from the same customers who benefit from the lower rates provided by the rate cap. | other | formal | 3 |
RE: o:\Research access list | Sandeep This is the list of the groups that have access to Research directory. Martin compiled this list. Please review it and let's talk about the recommendations regarding changes and restrictions we have to make. Vince | other | formal | 3 |
Data request | Eliz- can you handle? ----------------- | other | casual | 3 |
confidential employee information | Oxley asked that I send you a few bullets on Tom Martin. Please see below and let me know if you need further info. Feedback from two exit interviews from voluntary terminations in regard to Tom is as follows: was treated as inferior by my manager was lied to and insulted by my supervisor Tom berates employees in front of others and blames underlings for his mistakes. Additionally he second guessed every position I put on sold me out of positions (which turned out good) and used all our allocated VAR for his own benefit. Tom has a reputation for not representing employees well in the end of year review process. I found this to be the case as well. Tom is difficult to communicate with Additionally we had an incident w/ an employee when Tom offered her an employment agreement. She felt that she was being forced to sign the agreement When she declined the agreement and turned in resignation she said that Tom said he would make it difficult for her to leave She said that she felt threatened by Tom Her boy friend called Tom and threatened him As a result Legal asked Tom not to have further contact with the employee. | human resources | formal | 5 |
Confidential - May 2001 HR At A Glance | Attached is the May 2001 At A Glance report. A couple of additions this month which include a section on Capital Expenditures with Pay Backs and some analysis of the recent new hire survey that we set up. Please call if you have any questions. DCL | human resources | formal | 3 |
How should this be handled - rather touchy | Is this someone in the analyst/associate program? ----------------- | human resources | formal | 2 |
novak column | More indications that the power angle may be fruitful | other | casual | 0 |
Fenosa and Enron to Invest $550 Million in Dominican Republic | null | other | neutral | 0 |
Re: | I just checked with Jeff and Ken. They are both out of the office that day. Sorry it didn't work out. gilbert whitaker <grwhit@rice.edu> 03/06/2001 07:14 PM To: skean@enron.com cc: Subject: Steve - With respect to CK Prahalad's visit to Rice. As you know we are having a breakfast for the business community the morning of March 19 and he gives the Neuhas Lecture on Campus at 9:45 am. Following the lunch there is a lunch with Mrs. Neuhas the donor of the fund and faculty. That should be over by 1:15. He has a date from two to five at Enron with Yeager (Steve or Scott). He would like to meet with Ken or Jeff sometime that afternoon if at all possible. Thanks for your help. gil | project management | formal | 3 |
Tom DeLay CA Aug Dinner & Golf event | Jeff I spoke to Joannie this afternoon and asked for your e-mail to send this invitation. Here is the initial information on the event. We are expecting additional members of Congress to attend both events. If you have any questions or comment please let me know. I have attached a word doc. as well: Tom DeLay / ARMPAC Guest Speaker - David Horowitz Four Seasons Aviara - Dinner & Golf Tournament The event will take place: Wednesday August 15 Four Seasons Aviara (Northern San Diego CA) Golf Lunch will start at 11am Tee times at 12:15pm An informal reception afterwards Limited to 40 people Cost is $5k per person Dinner Reception 6 to 6:45pm Dinner 7 to 8:30pm Speakers Tom DeLay and David Horowitz $1500 per person $2500 per couple There are four levels of sponsorship: $100K $50k $25k and $15k. Contribution levels will also transfer from the dinner and/or Golf Tournament to the ARMPAC contributor sponsorship program. Bill Gowan Election Day Consulting LLC 1947 Camino Vida Roble suite 104 Carlsbad CA 92009 760 929.1203 electiondayconsulting.com - Aug 15 Golf dinner.doc | personal & social | formal | 3 |
LOGISTICAL INFORMATION FOR THE MAY 22-23, 2001 FORUM | meeting folder ----------------- | other | formal | 3 |
null | Several employees have asked about the exercise policy on stock options. Specifically they want to know what the exercise policy is on i) termination eg as a result of the prc process ii) voluntary departure iii) retirement or iv)resignation and to what extent do the rules vary across plans: i) AESOP LTIP deferred bonus etc. The main focus is on the length of time to exercise. I am concerned that there may be some odd incentives in the structure -- eg are severed employees allowed more time to exercise than employees who just leave voluntarily ( ie if you want to have a full three years to exercise options are you better off becoming a performance issue and getting severed than you would be if you simply left the company? | other | formal | 3 |
Fw: Confidential - Decision tree on projects | Fyi | project management | neutral | 0 |
Ken Lays email to Sen. Brulte | null | other | unprofessional | 0 |
Re: CI at EBS | Thanks for the message. Rita Hartfield@ENRON COMMUNICATIONS 07/17/2000 02:52 PM To: Steven J Kean/HOU/EES@EES cc: Anthony Mends/Enron Communications@Enron Communications Subject: CI at EBS Steve I have heard through the grapevine that Amy Oberg has relayed to you that EBS will not be doing competitive intelligence and that you were dismayed to hear this. Amy is correct in the fact that EBS is not likely to buy the software Strategy that provides a strategic top-down focus on competitive intelligence. However EBS is doing tactical competitive analysis and market research. We are providing the business units with the information that they need to make intelligent decisions at the business unit level. Amy's view is that competitive intelligence (CI) belongs at the corporate level and that CI should drive the strategic direction of the company. You and I both know this is not the way Enron operates. I hope this e:mail does not sound negative but I did want you to know that EBS is providing information and intelligence to its business units -- it is just not in the context that Amy thinks it should be in. If you have any questions please let me know. Rita Hartfield Phone: 713-853-5854 Cell: 713-304-5428 Fax: 713-646-8861 rita_hartfield@enron.net | market research | formal | 3 |
Board presentations | null | other | neutral | 0 |
Re: CONFIDENTIAL - Residential in CA | Jim / Karen - Thank you. We are not going to pull the trigger to turn back these customers without a full review and the agreement of all appropriate teams at Enron. Thanks - Dan Karen Denne@ENRON 04/13/2001 12:30 PM To: James D Steffes/NA/Enron@Enron cc: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Susan J Mara/NA/Enron@ENRON Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron Dan Leff/HOU/EES@EES Subject: Re: CONFIDENTIAL - Residential in CA Before any decision is made I think we really need to weigh in with EES on the ramifications (both PR and legislative) of turning back 16000 residential customers. I strongly believe that the public hit we will take will be far greater than our actual out-of-pocket losses. We will be crucified by the public media consumer groups legislators governor attorney general etc. and this action will reaffirm our reputation of packing up and leaving when it's not in our interest. The impact of this action would be exacerbated since it is on the heels of UC/CSU. I would also argue that this hurts our national dereg efforts. If we're advocating that competition and choice benefits consumers and then we turn around and pull out of a market and abandon customers when we're not profiting we'll kill any chances we have of ever serving retail customers in California -- or in any other state. We look foolish advocating for direct access when we're not willing to serve our existing -- let alone future customers What about a preemptive strike that engages these 16000 customers to weigh in on direct access -- i.e. a letter that says Enron may be forced to cancel its contract -- call/write/send the enclosed postcard to your legislator and tell them you want to keep your right to choose your energy service provider. Our credibility is on the line. Before we take this action we need to be cognizant of all the long-range strategic implications and we need to seriously weigh the negative impact this will have on our corporate reputation on our legislative abilities and on our commercial success going forward. kd James D Steffes 04/12/2001 09:05 PM To: Jeff Dasovich/NA/Enron@Enron Paul Kaufman/PDX/ECT@ECT Sandra McCubbin/NA/Enron@Enron Richard Shapiro/NA/Enron@Enron Janel Guerrero/Corp/Enron@Enron Mark Palmer/Corp/Enron@ENRON Karen Denne/Corp/Enron@ENRON Susan J Mara/NA/Enron Peggy Mahoney/HOU/EES@EES Harry Kingerski/NA/Enron@Enron cc: Dan Leff/HOU/EES@EES Subject: CONFIDENTIAL - Residential in CA In the meeting today no decision was made about what to do with Enron's 16000 residential customers. Each of the contracts gives a basic 30 day out right to Enron. That being said I think that we have a short window to push for DA before any public action impacts us in Sacramento. I realize that the ultimate action (which I think is inevitable) makes it harder for our advocacy on DA but real $ are flowing out of the company. EES will give us notice when a decision is reached. Thanks Jim | other | formal | 5 |
Meeting to discuss U of H | ----------------- | other | casual | 3 |
null | FYI | other | casual | 0 |