Other than that, where's the rub? Under derequlation, consumers were supposed
to get market rates in 2002. Based on the current forward market and the
utilities’ cost of retained generators, 7 cents/kwh for the rest of this year is
a great deal. For 2002, it's fair, but for 2003-2008, it's terrible, The current
purchase price for those years is about 5 cents. With utility-owned generation
at 3 vee consumers will be paying 7 cents/kwh when they should be paying 4
cents/kwh,.

And the 2.4 cents/kwh competition transition charge (CTC) that was supposed to
end in 2002 has to be extended several more years. The CTC is “"non-bypassable,”
which means if you leave the local monopoly for an alternative supplier, you
still have te send a couple of cents/kwh to the old utility.

Ratepayer groups got about 40 people to storm the PG&E corporate headquarters
this week over the one cent rate increase. Another rate increase would cause
riots and ballot initiatives, and cost Davis his job.

But can consumer groups get people out in the streets over a deal that's great
now, but overcharges them starting in 2003? I doubt it.

Businesses such as Intel Corp, (INTC) will know they are getting the short end
of the stick financially and that power in the western U.S. is still unreliable,
so they will decide to build new factories in other stat That's how you
bypass non-bypassable charges. It will be bad for the st economic growth,
but California needs to stop adding electricity demand.

The stare are aligned for a deal very soon: eight days left before the
executive branch of the U.3. government changes from one that wants to help
Davis to one that wants to hurt him; about the same amount of time is left
before the utilities run out of cash; forward power prices have come down a lot
in the past 30 days, but could easily start to rise again; merchant power
company stock prices have been punished for two weeks, and their executives
don't want to kill the golden goose.

How can they not get this done?
-By Mark Golden, Dow Jones Newswires; 201-938-4604; mark.golden@dowjones.com

(END) Dow Jones Newswires 12-01-01

1800GMT
{AP=DJ-01-12-01 1800GMT)
TICKER: CPN DUK DYN EIX ENE INTC NRG PCG REI 30 SOE
?SUBJECT: EUTL SEMI DI1 DI4 DI2 CA GA MN NC TX COMM
Copyright {c) 2001 Dow Jones and Company, Inc.
Received by NewsEDGE/LAN: 1/12/01 12:55 2M
<=> End of message body

Message auditing by MicroData CAMEO Recon


From; Wilcox, David
Sent: Thursday, February 21, 2002 12:47 AM
To: SearchCameo

CAMEO Recon found a word: Enron sent by Posner, Steven to Smith, Michelle A.; Klasky,
Helaine; Weaver, Elizabeth; Gallagher, Una; Buck, Bill; Gensler, Gary; Sachs, Lee; Stewart,
Lawranne; Greene, Michelle; Wilcox, David; Elmendor, Douglas; Vandivier, Dav

This message was found to have a Critical Word in it. Message Sent to Smith, Michelle A.;
Klasky, Helaine; Weaver, Elizabeth; Gallagher, Una; Buck, Bill; Gensler, Gary; Sachs, Lee;
Stewart, Lawranne; Greene, Michelle; Wilcox, David; Elmendorf, Douglas; Vandivier, David:
Sandberg, Sheryl: Stern, Todd; Cohen, Alan; Wolin, Neal; Moe, Martin, From Posner, Steven,
CC to , Date 1/12/2001 4:28:58 PM, Subject of message wires - California Power Talks

Word(s) found: Enron

~----Original Message----~

From: Posner, Steven

Sent: 1/12/2001 4:28:58 PM

Received: 1/12/2001 4:28:58 PM

To: Smith, Michelle A., EX:/O-USTREASURY/OU=DO/CN=RECIPIENTS/CN=SMITHM
Klasky, Helaine, EX: /O-USTREASURY/OU*DO/CN*RECIPIENTS/CN#KlaskyH
Weaver, Elizabeth, EX: /O-USTREASURY/CU*DO/CN*RECIPIENTS/CN*WEAVERE
Gallagher, Una, EX: /OeUSTREASURY/OU*DO/CN@RECI PIENTS/CN#GALLAGHERU
Buck, Bill, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=BUCKW
Gensler, Gary, EX:/O=USTREASURY/OU=DO/CN#RECIPIENTS/CN=GENSLERG
Sachs, Lee, EX:/O=USTREASURY/OU=D0/CN@RECIPIENTS/CN=SachsL
Stewart, Lawranne, EX:/O=-USTREASURY/OU=DO/CN=RECIPIENTS/CN=STEWARTLAW
Greene, Michelle, £X:/O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GREENEME
Wilcox, David, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=WILCOXD
Elmendorf, Douglas, EX:/O=USTREASURY/OU=D0/CN=RECI PIENTS/CR=ELMENDORFD
Vandivier, David, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=VandivierD
Sandberg, Sheryl, EX: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=DOM3. DOPOS,Sandbergs
Stern, Todd, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=DOM3.DOPOS.SternT
Cohen, Alan, EX:/O=USTREASURY/OU*=DO/CN=RECIPIENTS/CN=DOM3. DOPOS. COHENA
Wolin, Neal, EX:/O*USTREASURY/OU*DO/CN*RECIPIENTS/CNeWOLINN
Moe, Martin, EX:/O-USTREASURY/OU=DO/CN+RECI PIENTS/CH+DOM3.DOPOS.MoeM

ce:

Subject: wires - California Power Talks

Body:

DJ Principals In Calif Pwr Talks Set To Reconvene Saturday

Dow Jones International News Service via Dow Jones

WASHINGTON [Dow Jones}--The principal negotiators involved in White
House-brokered talks to solve California's electricity crisis are slated to
reconvene here Saturday afternoon, the U.S. Treasury Department confirmed
Friday.

The resumption of high-level talks among top-ranking officials representing
the Clinton administration, California, and utilities and power suppliers will
take place at U.S. Department of Energy headquarters at 3:30 p.m. EST.

California Gov. Gray Davis and other key state regulators and lawmakers are to
participate via a video conferencing link.

The pivotal negotiating session comes after two working groups involving
lower-level officials have met since Wednesday in an effort to flesh out the
details of a broad settlement package the principals discussed late Tuesday
during a seven-hour meeting at the Treasury Department.


hearings in 222 RSOB. 106 DSOB. 9:30 a.m. Contact: 202-224-3871.

BANKING

Exports

Full committee markup of 5.149, the Export Administration Act of
2001, 538 DSOB. 10 a.m. Contact: 202-224-7391.

BUDGET

Federal Debt

Pull committee hearing on debt management. Witness: Gary Gensler,
former undersecretary for domestic finance, Treasury Department.
608 DSOB. 11 + Contact: 202-224-0642.

ENERGY AND NATURAL RESOURCES

National Park Service

National Parks, Historic Preservation and Recreation Subcomnittee
oversight hearing to review the National Park Service's
implementation of management policies and procedures to comply
with the provisions of Title IV of the National Parks Omnibus
Management Act of 1998. 192 DSOB. 2:30 p.m. Contact: 202-224-
4971.

FINANCE

Prescription Financing

Pull committee hearing on prescription drugs and Medicare.215
DSOB, 2:30 p.m. Contact: 202-224-4515.

FOREIGN RELATIONS

Security Threats

Full committee briefing on the intelligence assessment of
emerging national security threats. S-407 Capitol. 10:30 a.m.
Contact: 202-224-4651. (Closed.)

GOVERNMENAL AFFAIRS

DC Metropolitan

Government Management, Restructuring and the District of Columbia
Subcommittee hearing on assessing the DC Metropolitan PD's Y2K
performance. 342 DSOB. 10 a.m. Contact: 202-224-4751.

Health, Education, Labor and Pensions

Health Services

Public Health Subcommittee hearing to examine increasing access
to essential healthcare services. 430 DSOB. 10 a.m, Contact: 202-
224-5375.

INDIAN AFFAIRS

Indian Goals

Full committee hearing on the goals and priorities of the members
of the National Congress of American Indians for the 107th
Congress. 485 RSOB. 2 p.m. Contact: 202-224-2251.

INTELLIGENCE

Intelligence

Full committee hearing on intelligence matters. 219 HSOB. 2 p.m.
Contact: 202-224-1700, (Closed.)

=HOUSE COMMITTEES=

Administration

Committees Funding

Full committee markup of the Omnibus Committee Funding Resolution
of the 107th Congress and other pending matters. 1310 LHOB. 1
p-m. Contact: 202-225-9281.

AGRICULTURE

Livestock Industry

Full committee hearing te review federal farm commodity programs
with the livestock industry. 1300 LHOB. 9:30 a.m. Contact: 202-


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Enron Rebounds in Second Quarter,



From; ‘Squitien, Ray

Sent: Thursday, February 21, 2002 12:19 AM

To: SearchCameo
CAMEO Recon found a word: Enron sent by Jone-Lin Wang to Ray. Squitieri@do.treas.gov'
on 1/2/2001 3:26:44 PM

This message was found to have a Critical Word in it. Message Sent to
‘Ray. Squitieri@do.treas.gov', From Jone-Lin Wang, CC to , Date 1/2/2001 3:28:44 PM,
Subject of message FW: Daily Electric Power News - 01-02-01

Word(s) found: Enron

--+--Original Measage-----

From: Jone-Lin Wang

Sent: 1/2/2001 3:28:44 2M

Received: 1/2/2001 3:26:22 PM

To:  ‘Ray.Squitieri@do.treas.gov', SMTP:Ray.Squitieri@do.treas.gav

cc:

Subject: Fu: Daily flectric Power News - 01-02-01
Body:

Try this too..,woof

From: news@mail.energycentral.com [mailto:news@mail.energycentral. com]
Sent: Monday, January 01, 2001 7:20 PM

To: jwang@cera.com

Subject: Daily Electric Power News ~ 01-02-01

Enron Energy Information Solutions

HOME | NEWSROOM | EVENTS | JOBS | BUSINESS CENTERS | DIRECTORIES | DATABASES
TUESDAY, JANUARY 2, 2001

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TOP STORIES

Genesis of State's Energy Fiasco / String of Bad Decisions on Deregulation Could


deal by then.

Tuesday is the deadline because it will be the first
working day after a three-day U.S. holiday weekend. Wall Street
traders and ang agencies have been anxiously watching the
crisis negotiations over the past five days to evaluate the
financial standing of the nearly bankru

Power Woes
Feds, state and utilities meet to broker electricity deal

LOS ANGELES (AP) State, federal and utility company officials
negotiated solutions to the electricity crisis for seven hours
Saturday by a live satellite hookup linking both coasts. There were
no decisions and negotiators were able only to schedule further
talks on a plan that could make California a long-term electricity
broker.

President Clinton’s top economic adviser, Gene Sperling, said he
believed there would be further talks in the next two days.

"I don't think any of us expect to get to the finish line
tonight,'' Sperling said. “°I think we can still make some more
progress.''

Gov, Gray Davis, who's been pushing to put the state into the
broker's role, said California is “‘a credit-worthy purchaser. All
of us that met today are joined at the hip and if we are going to
move forward, we will move forward together.'"

A state agency, under emergency powers from Washington, already
has = spent roughly $30 million buying electricity in the past month
to stave off rolling blackouts during the California power crisis.
Officials want the state to expand and continue wholesale
electricity buys, selling the power to utility companies, said
Steve Maviglio, a spokesman for Gov. Gray Davis.

The California Department of Water Resources made the earlier
emergency power purchases, including about 24,000 megawatt hours of
electricity on Thursday and Friday, Carl Torgersen, the
department's chief of utility operations, said Saturday. The
department acted under authority of emergency orders by U.S. Energy
Secretary Bill Richardson.

*'(This) is something we've never done before,’' Torgersen said.
““We're in a new era with deregulation.''

Wholesale power prices have inc. ied fivefold in California
since last summer, accompanied by a sex: of drops in the state's
power reserves in part because power plants are shut for
maintenance.

On Thursday, power reserves in California dipped below 2 percent
after a storm cut production at a key nuclear station.

The Independent System Operator, which manages most of the
state's power grid, said electricity supplies had rebounded but
were still tight.

Davis and Govs. John Kitzhaber of Oregon and Gary Locke of
Washington said Friday that they would urge their residents to cut
electricity demand 7 to 10 percent, try to reduce power use by
their state governments by at least 10 percent, and look into
joining forces to buy energy-efficient products for state and local
agencies to get through the crisis.

Davis and California's two largest investor-owned utilities have
pointed fingers at energy wholesalers, saying they have exacerbated
the crisis by taking advantage of the tight supplies for their own
profit.

Pacific Gas & Electric Co, and Southern California Edison, both
electricity retailers, say they have lost more than §% billion
because of wholesale price incr and the state's 1996
deregulation law that froze h + The utilit. which won
permission to raise rates, said the temporary incr Ss approved by
the Public Utilities Commission weren't enough and have warned they
could go bankrupt if something isn't done.

Davis, Kitzhaber and Locke said in a written statement that the



From: ‘Squitien, Ray

Sent: Thursday, February 21, 2002 12:05 AM

To: SearchCameo

Subject: CAMEO Recon found a word: Enron sent by SCIENTECH IssueAlen to on 5/22/2001
7:57:43 AM

Issuedlert

5_22_01.hemi
This message was found to have a Critical Word in it. Message Sent to , From

SCIENTECH IssueAlert, CC to , Date 5/22/2001 7:57:43 AM, Subject of message Enron Locked
in Contentious Battle over Indian Project

Word(s) found: Enron

aeelenl ‘Original Message-----

From: SCIENTECH IssueAlert

Sent: 5/22/2001 7:57:43 AN

Received: $/22/2001 2:08:00 EM

To:

cc:

Subject: Enron Locked in Contentious Battle over Indian Project
Body:

swcece End of message body

Message auditing by MicroData CAMEO Recon


coon End of message body
Message auditing by MicroData CAMEO Recon


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From; Affieck-Smith, Joan
Sent: Wednesday, February 20, 2002 7:27 PM
To: SearchCameo

CAMEO Recon found a word: Enron sent by
/O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM3,00PO5.JONE
‘SVJA to Carter, Ted; Dom13.00PO07 ArkinS; Dom13.D0PO7,BAKERR; Conly, Sonia;
Dom13.00P07.CUMBYR; Dom13.00P07.DAVIEB; Dom13.00P07.DELAVINAL;
Dom13.D0P07.F

This message was found to have a Critical Word in it. Message Sent to Carter, Ted;
Dom]13.DOPO7.ArkinS; Doml3.DOPO7.BAXERR; Conly, Sonia; Doml3.DOPO7.CUMBYR,

Dom]3.DOPO7. DAVIES; Doml3.DOPO7,DELAVINAL; Doml3.DOPO7.FLANAGANR: Doml3.DOPO7,GERARDIG;
Dom13.DOPO? HOLTZBLATTJ: Doml3.DOPO7.IWRYM; Doml3.DOPO7.KNOPFKs Doml3.DOPO7.MCCUBBINI;
Dom13.DOPO7.MIKRUTJ; Talisman, Jon; Doml3,DOFO7.VandivierD: Doml3.DOPO7.WALKERD; Atkinson,
Caroline; Baukol, Andrew; Budington, Michele; Cetina, Jill; Dom13.D0PO8.CHAVESM;
Eichenberger, Joe; Fall, James; Geithner, Timothy: Gelpern, Annas John, James; Lee, Nancy;
Lowery, Clay; Ludden, Ken; Schuerch, William; Stedman, Louellen; Truman, Ted; Walsh,
Helen; Alagiri, Priya; Andrews, Lisa; Arnold, Thomas; Bordoff, Jason; Cameron, Art;
Carter, Jana; Cohen, Alan; Comstock, Neal; Decker, Larry; Desler, Anne; Egolf, Brian:
Eizenstat, Stuart; Fant, William; Flanders, Stephanie; Gathers, Shirley; Grayson, Cherry;
Harvey, Reavie; Herold, Valerie; Johnson, Linda; Joseph, Verlene; Keene, Carolyn; Keller,
Alan; Kim, Carol; Klasky, Helaine; Levine, Marne; Longbrake, John; Luce, Ed; Matera,
Cheryl; McAuliffe, Laura; Mejia, Annabella; Moore, Holly; Muldoon, Lara; Nisanci, Didem;
Powell, Linda; Robertson, Linda; Sandberg, Sheryl; Smith, Michelle A.; Starks, Ora; Stern,
Todd; Summers, Larry; Toohey, Frank; Valentic, Marsha; Barber, Francine; Barbour, Gaylen;
Bieger, Peter; Carro, Richard; Cohen, David; Edsall, Alexandra; Greene, Michelle; Joy,
David; Kellogg, Cliff; McGivern, Tom; McHale, Stephen; McInerney, Roberta; Sachs, Lee;
Wolin, Neals ex.mail.JONESM; ex.mail.VJORSTAD; Adashek, Jonathan: Affleck-Smith, Joan:
Baer, Gregory; Barr, Michaels Bell, Rochelle; Beresik, Michael; Bresee, Elisabeth;
DeMarco, Edward; Foote, Norman; Gensler, Gary; Johnson, James; Lebryk, David; Ross, Lisa,
From /O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3.DOPOS.JONESJA, CC to , Date
11/9/2000 9:31:00 AM, Subject of message Linda Robertson's info.

Word(s} found: Enron

ontwn| Original Message----~

From: /O=USTREASURY/OU*DO/CN*RECIPIENTS/CN*GROUPWISE/CN*DOM3, DOPOS. JONESJA

Sent: 11/9/2000 9:31:00 AM

Received: 11/9/2000 9:32:07 AM

To: Carter, Ted,

EX: /O*USTREASURY/OU=DO/CN=RECI PIENTS/CN@GRCUPWISE/CN=DOM11.DOPO4.CARTERT
Doml3.DOPO7.ArkinS, GWISE:Doml3.DOPO7.ArkinS
Doml3.DOPO7.BAKERR, GWISE:Doml3.DOPO7.BAKERR
Conly, Sonia,

EX: /O=USTREASURY /OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPO7.CONLYS
Doml3.DOPO7.CUMBYR, GWISE:Dom13.DOPO7.CUMBYR
Doml3.DOPO7?.DAVIEB, GWISE:Dom13.DOPO7.DAVIEB
Dom13.DOPO7.DELAVINAL, GWISE:Dom13.DOPO7.DELAVINAL
Doml3.DOPO7?.FLANAGANR, GWISE:Dom13.DOPO7. FLANAGANR
Doml3.DOPO7.GERARDIG, GWISE:Doml3.DOPO?.GERARDIG
Doml3.DOPO7.HOLTZBLATTJ, GWISE:Dom13.DOPO7.HOLTZBLATTJ
Doml3.DOPO7.IWRYM, GWISE:Dom13.DOPO7. IWRYM
Doml3.DOPO7.KNOPFK, GWISE:Dom13.DOPO7.KNOPFK
Doml3.DOPO7.MCCUBBINJ, GWISE:Doml3.DOP07.MCCUBBINT
Dom13.DOPO7.MIKRUTJ, GWISE:Doml3.DOPO7.MIKRUTJ
Talisman, Jon, EX:/O#USTREASURY/OU*DO/CN*RECIPIENTS/CNTALISMANT
Doml3.DOPO7.VandivierD, GWISE:Dom13.DOPO7.VandivierD
Doml3.DOPO7.WALKERD, GWISE:Doml3.DOPO7.WALKERD
Atkinson, Caroline,

EX: /O@USTREASURY /OU=DO/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13. DOPOS .ATKINSONC
Baukol, Andrew,

EX: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM13.DOPOS. BAUKOLA


From; Affieck-Smith, Joan
Sent: Wednesday, February 20, 2002 5:51 PM
To: SearchCameo

CAMEO Recon found a word: Enron sent by
/O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM3,00PO5.JONE
‘SVJA to Carter, Ted; Dom13.00PO07 ArkinS; Dom13.D0PO7,BAKERR; Conly, Sonia;
Dom13.00P07.CUMBYR; Dom13.00P07.DAVIEB; Dom13.00P07.DELAVINAL;
Dom13.D0P07.F

This message was found to have a Critical Word in it. Message Sent to Carter, Ted;
Dom]13.DOPO7.ArkinS; Doml3.DOPO7.BAXERR; Conly, Sonia; Doml3.DOPO7.CUMBYR,

Dom]3.DOPO7. DAVIES; Doml3.DOPO7,DELAVINAL; Doml3.DOPO7.FLANAGANR: Doml3.DOPO7,GERARDIG;
Dom13.DOPO? HOLTZBLATTJ: Doml3.DOPO7.IWRYM; Doml3.DOPO7.KNOPFKs Doml3.DOPO7.MCCUBBINI;
Dom13.DOPO7.MIKRUTJ; Talisman, Jon; Doml3,DOFO7.VandivierD: Doml3.DOPO7.WALKERD; Atkinson,
Caroline; Baukol, Andrew; Budington, Michele; Cetina, Jill; Dom13.D0PO8.CHAVESM;
Eichenberger, Joe; Fall, James; Geithner, Timothy: Gelpern, Annas John, James; Lee, Nancy;
Lowery, Clay; Ludden, Ken; Schuerch, William; Stedman, Louellen; Truman, Ted; Walsh,
Helen; Alagiri, Priya; Andrews, Lisa; Arnold, Thomas; Bordoff, Jason; Cameron, Art;
Carter, Jana; Cohen, Alan; Comstock, Neal; Decker, Larry; Desler, Anne; Egolf, Brian:
Eizenstat, Stuart; Fant, William; Flanders, Stephanie; Gathers, Shirley; Grayson, Cherry;
Harvey, Reavie; Herold, Valerie; Johnson, Linda; Joseph, Verlene; Keene, Carolyn; Keller,
Alan; Kim, Carol; Klasky, Helaine; Levine, Marne; Longbrake, John; Luce, Ed; Matera,
Cheryl; McAuliffe, Laura; Mejia, Annabella; Moore, Holly; Muldoon, Lara; Nisanci, Didem;
Powell, Linda; Robertson, Linda; Sandberg, Sheryl; Smith, Michelle A.; Starks, Ora; Stern,
Todd; Summers, Larry; Toohey, Frank; Valentic, Marsha; Barber, Francine; Barbour, Gaylen;
Bieger, Peter; Carro, Richard; Cohen, David; Edsall, Alexandra; Greene, Michelle; Joy,
David; Kellogg, Cliff; McGivern, Tom; McHale, Stephen; McInerney, Roberta; Sachs, Lee;
Wolin, Neals ex.mail.JONESM; ex.mail.VJORSTAD; Adashek, Jonathan: Affleck-Smith, Joan:
Baer, Gregory; Barr, Michaels Bell, Rochelle; Beresik, Michael; Bresee, Elisabeth;
DeMarco, Edward; Foote, Norman; Gensler, Gary; Johnson, James; Lebryk, David; Ross, Lisa,
From /O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3.DOPOS.JONESJA, CC to , Date
11/8/2000 8:42:00 AM, Subject of message Linda Robertson's info.

Word(s} found: Enron

ontwn| Original Message----~

From: /O*USTREASURY/OU=DO/CN*RECIPIENTS/CN*GROUPWISE/CN*DOM3, DOPOS. JONESJA

Sent: 11/6/2000 8:42:00 AN

Received: 11/8/2000 8

To: Carter, Ted,

EX: /O*USTREASURY/OU=DO/CN=RECI PIENTS/CN@GRCUPWISE/CN=DOM11.DOPO4.CARTERT
Doml3.DOPO7.ArkinS, GWISE:Doml3.DOPO7.ArkinS
Doml3.DOPO7.BAKERR, GWISE:Doml3.DOPO7.BAKERR
Conly, Sonia,

EX: /O=USTREASURY /OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPO7.CONLYS
Doml3.DOPO7.CUMBYR, GWISE:Dom13.DOPO7.CUMBYR
Doml3.DOPO7?.DAVIEB, GWISE:Dom13.DOPO7.DAVIEB
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Talisman, Jon,

EX: /O-USTREASURY /OU*DO/CN*RECI PIENTS/CH*GRCUPWISE/CN*DOM13.DOPO?7. TALISMANT
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Atkinson, Caroline,

EX: /O@USTREASURY /OU=DO/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPOS .ATKINSONC
Baukol, Andrew,

223 AM


Por more information about products on this topic visit our Information Marketplace

HENWOOD DETAILS SUMMER 2001 ELECTRICITY FORECASTS THROUGH RELEASE OF WSCC
INTERCONNECTS AND POWER FLOWS MAP
December 29, 2000 Sacramento, CA Henwood Energy Services, Inc. announced the release of a
newly-developed WSCC market power map detailing forecasts for Summer 2001. The Henwood
WSCC 2001 Interconnects and Power Flows Map defines the Summer 2001 power needs for the
WSCC including California.

International

For more information about products on this topic visit our Information Marketplace

Spain govt approves avg 1.52 pct cut in 2001 electricity tariff
Dec 29, 2000 - MADRID (AFX) - The cabinet has approved an average 1.52 pct reduction in
electricity tariffs for 2001, the government said.

Tokyo Electric Power to Move Into Rival Tohoku's Turf (UpdateS)
Dec 27, 2000 - Bloomberg Tokyo Electric Power Co., Japan's biggest power utility, said it
will supply electricity in the northern Tohoku region, an area where Tohoku Electric Power
Co. has long been the dominant power supplier.

Mexican State-Owned Power Company Loses 3.6 Billion Pesos
Dec 28, 2000 - Infolatina S.A. de C.V. Mexican state-owned electricity company Lut &
Fuerza del Centro during the first half of 2000 lost 3.6 billion pesos despite the fact
that it received federal subsidies totaling 4.4 billion pesos.

Endesa confirms 42 bln ptas investment with Elecnor in Argentina
Dec 27, 2000 - MADRID (AFX) - Endesa SA said it has signed an agreement with Elecnor SA to
form the 50-50 joint venture Energias Argentinas SA (Enarsa) which will invest an initial
42 bln ptas in wind-energy projects in Argentina.

EU commission reportedly may oblige Spain's power cos to pay back govt subsidy
Dec 27, 2000 ~ AFK News Limited The European Commission may oblige Spanish power companies
to pay back part of the subsidies received from the government, yesterday's El Pais
reported.

Spain 2000 electricity demand up 6.25 pet vse yr-earlier - Red Electrica
Dec 28, 2000 - MADRID (AFX) - Red Electrica de Espana SA said electricity demand rose 6.25
pet in 2000 from a year earlier.

EGCOMP seen affected by power surplus in 2001: Seamico Securities
Dec 28, 2000 - BANGKOK {AFX-ASIA) - Electricity Generating Plc is expected to be
negatively affected by an electricity surplus in 2001 due to the company's plan to invest
in independent producer projects and small producer projects, a report by Seamico
Securities said.

Union Fenosa sees 2001 overseas ops revenue 2.530 bln eur vs 1.448 in 2000
Dec 29, 2000 = MADRID (AFX) ~ Union Electrica Fenosa SA said revenue from its overseas
Operations are expected to nearly double in 2001 to 2.530 bln eur from 1.448 bln in 2000.

Telenor exercises 10 pet VIAG put option; BT to pay more than 20 bin nkr
Dec 29, 2000 - AFX News Limited Telenor ASA said it is exercising an option to sell its 10


against the bill, which would still be subject to amendment.

He acknowledged major differences between the two versions on
issuea like the homestead exemption for bankruptcy filers.

“We don't want that one issue to cause this entire bankruptcy
bill to not go forward,” he said.

Majority Leader Armey said Tuesday evening that the House
would “probably” follow the approach that Lott outlined. As for
the Senate homestead language, he said, “I don't think we can
come to our floor with their language.” ~-~- By Geoff Earle

CAMPAIGN FINANCE
Campaign Finance Reform Debate Facing Test In Hagel Proposal

Reaction by the bill'a sponsors to Senate approval Tuesday of
the first amendment to the campaign finance reform legislation
was subdued. But Democratic leaders took a more aggressive
stance.

The amendment, sponsored by Sens. Pete Domenici, D-N.M. and
Mike DeWine, R-Ohio and approved by a 70-30 vote, would
proportionally ra hard-dollar contribution limits for anyone
challenging a self-funding candidate.

“I'm not thrilled about having this in the bill," said Sen.
Russell Feingold, D-Wis., co-author of the so-called McCain-
Feingold bill. “But I'm glad we have disposed of the issue.“

Similarly, Sen. John McCain, R-Ariz id that the amendment
was an expected part of the proce and pivoted to focus on the
“central” issues of the legislation: soft money, independent
expenditures and severability.

Senate Minority Leader Daschle called the amendment an
“incumbent protection act.”

“This is no longer McCain-Feingold,” Daschle said. "This is
McCain-Feingold-Domenici.”

But Daschle said that the addition of the Domenici amendment
alone would not cause him to oppose the larger bill.

Sen. Chuck Hagel, R-Neb., one of only three Republicans to
vote against the amendment, said the bill is “blatantly
unconstitutional,"

As both sides reacted to the amendment's passage, Hagel was
working to build momentum for his rival campaign finance reform
legislation.

At a news conference, Hagel and several cosponsors from both
sides of the aisle promoted the bill, which would cap soft-money
contributions at $60,000 and triple the current $1,000 hard-
dollar contribution limit.

Sen. John Breaux, D-La., pointed out that more than 100
"single-issue interest groups" would still be able to run ads if
MeCain-Feingold passed, adding that the legislation would create
a "terribly unlevel playing field.”

Hagel would not discuss when his proposal would be brought to
the floor as an amendment to McCain-Feingold or whether it would
be presented as a whole or separated into pieces when introduced.

McCain-Feingold supporters downplayed the viability of the
Hagel's proposal,

“The legalization of soft money will not pass the Senate,"
said McCain.

Feingold said that approval of the Hagel amendment would “put
@ stamp of approval on soft money once and for all,”

Two other Republican amendments were defeated Tuesday. The
amendments by Sens. Robert Bennett, R-Utah, and Gordon Smith, R-
Ore., dealt with use of soft money by labor and business. -- By
Chris Cillizza, with Charlie Mitchell and Will Conley

Senators Seek To Use Review Act On Family Planning Rule


Knowledgeable sources descrihed Treasury Secretary Lawrence Summers as taking
an active role in attempting to forge an agreement during Tuesday's talks, which
also featured Energy Secretary Sill Richardson, White House economic adviser
Gene Sperling and Federal Energy Regulatory Commission Chairman James Hoecker.

Richardson, who is traveling this weekend in an effort to lobby oil-producing
nations against a pending production cut, will not be attending Saturday's
session,

The working group meetings will wrap up sometime Friday, the Treasury
Department said.

The two groups have separately addressed the two primary features of the
proposed settlement, which involve moving the state's financially ailing
utilities out of volatile spot power markets and into fixed-price forward
contracts while power producers agree to "forbearance" on the huge debt owed by
the utilities

The forbearance and contracts working groups have been meeting separately, and
were to convene a joint session late Friday to compare notes before reporting
back to the principal negotiators who will cut any final deal.

Those familiar with the talks have expressed a mix of pessimism and optimism
that a final deal can be struck, given what they described unrealistic
bargaining demands by Gov. Davis.

He has firmly rejected retail rate increases and resisted demands for the
state to guarantee the nearly $12 billion utilities have paid over the last
eight months for wholesale power but been unable to pass along under
state-mandated frozen retail rates.

Further complicating the talks have been demands by Davis that the proposed
long-term power contracts be at rates far below the production costs of
electricity generators.

But lately the pessimism has been tempered by signals that Davis may be
persuaded to relent Saturday in his opposition to a state-backed securitization
of the utilities’ undercollections.

“Let's see their plan, and then we'll talk about that," Steve Maviglio, the
governor's spokesman, said late Thursday.

Davis reportedly has been under increasing pressure from Wall Street and
Clinton administration officials to reconsider his opposition to securitization.

Without a state credit guarantee, a work-out plan can't be struck, the
utilities will enter bankruptcy and the state's power grid will collapse into
blackouts, sources familiar with the talks warn.

The affected utilities are Southern California Edison Co., a unit of Edison
International (EIX), and Pacific Gas & Electric Co., a unit of PGSE Corp. (PCG).

By Bryan Lee, Dow Jones Newswires, 202-862-6647, bryan. lee@dowjones.com

(END) Dow Jones Newswires 12-01-01
2100GMT

{AP-DJ~-01-12-01 2100GMT)

?TICKER: EIX PCG SRE

SUBJECT: EUTL STGO DI7 DI1 DI4 DI2 CA COBO COMM
Copyright (c) 2001 Dow Jones and Company, Inc.
Received by NewsEDGE/LAN: 1/12/01 3:55 PM


kind. SCIENTECH's sole purpose in publishing its IssneAlerts ts to offer an independent
perspective regarding the key events occurring in the energy industry, based on its long-standing
reputation asan expert OW CHTRY ISSUES,

Copyright 2001, SCIENTECH, Ine, All rights reserved.



network of hydroelectric dams might not be able to produce enough power for
their own needs, let alone California's.

"We have very low water," Locke warned, “and we're concerned about our ability
to have enough energy in the apring. We don't know if we can ship energy down
{te California] in the summer."

Western governors will meet Feb, 2 in Portland at an energy conference to
address the region's power problems, and Oregon Gov. John Kitzhaber [D)
expressed his hope that the crisis “will not descend into partisan bickering.”
The th West Coast governors are Democrats. The governors of the other western
states are Republicans.

Davis said the West Coast governors are united and that together they will
press the FERC to agree to place price caps on wholesale energy costs.

“We need a timeout,” Davis said, “for our markets to stabilize.” The
California governor, who said the state will continue at least temporarily to
buy electricity for the utilities, noted that he is not against wholesale energy
providers making a profit, “but not at cost of our economy.”

Yet the FERC has resisted firm price caps for wholesale power, and its
position may be hardened by the incoming Bush administration, which will appoint
hew members to the commission.

The situation is further complicated by the fact that many of the energy
producers whom Davis has called “pirates” and “marauders” -~ are
Houston-based companies such as Reliant Energy Inc. and Dynery Inc. Many are
waiting to see if Bush, a former oilman from Texas, will smack the industry with
price caps.

For months, as the electrical supply-and-demand predicament has grown worse,
California has relied on desperate patchwork moves to avoid a power meltdown.

It has declared several dozen statewide emergencies of varying degrees to urge
consumers to conserve more power, but that has not been much help. A blackout,
some authorities say, might be the only step that could seize the public's
attention and force it to change its energy-inefficient habits. Yet there are
dons about how much more efficient it can be. Davis points out that the
@ ranks among the most energy efficient on a per capita basis.

California's Public Utility Commission also recently approved a limited
emergency rate increase of 9 percent to 15 percent. Meanwhile, the state has
persuaded federal energy officials to extend an unusual emergency order, three
times, that requires power suppliers around the country to sell surplus
electricity to the state's beleaguered utilities even though they have poor
credit.

But there is a growing consensus that the state may be out of miracles. And
that no way cut of the energy morass will be quick, painless or cheap.
Eventually, the utilities, ratepayers, energy providers and taxpayers will
likely be given the bill.

“There is no doubt that it is going to be very, very expensive to dig us out
of this hole," said Carl Wocd, a member of the Public Utility Commission.

The state's next challenge is the threatened stoppage of deliveries of natural
gas, which heats homes and fuels electricity generation. One supplier has
stopped delivering gas to Pacific Gas & Electric, and it says another supplier
will cut off the flow next week because of concerns it won't be paid. Today,
Davis asked Energy Secretary Bill Richardson to use federal emergency powers to
keep the gas flowing.

To Davis and other state leaders, imposing more immediate rate increases on
California consumers is out of the question. The governor is also resisting
calls to bail out the debt-ridden utilities with state bonds. Instead, he wants


Director, Electric Industry Analysis

[News item from Reuters) The Indian federal government is optimistic that Enron Corp.
(NYSE; ENE) and the Maharashtra state government will resolve their wrangle, which
has jeopardized the U.S. energy giant's $2.9 billion power project. Indian lenders want
their federal government to intervene after a threat by Enron Corp., the country’s largest
foreign investor, to walk out of a giant power project has put the loan of the Indian
groups in jeopardy. Local lenders including the Industrial Development Bank of India
and the country’s largest commercial bank, State Bank of India, stand to lose billions if
Enron pulls out the deal. On May 19, Enron took a major step toward pulling the plug on
= the project by issuing a notice to terminate its contract to sell power to the Maharashstra
state

Analysis: This news item is significant for two reasons. First, Enron's ongoing troubles in India are
causing other power companies to also scramble from their investments in the country or avoid India
altogether. This comes at an unfortunate time for the undeveloped country, as it was hoped that the
investment from Enron and other companies would provide a significant financial boost to India's
energy infrastructure. Second, it is rather ironic that Enron, which has gained an eamings boon from its
wholesale and trading activities in the United States, has faced financial challenges overseas by
following the one business strategy that it has mostly avoided in this country: owning hard generation
assets.

By way of background, Enron was first approached by the Maharashtra government back in 1992
regarding the joint development of a new power project to serve the western part of India. In the mid-
1990s, Enron broke ground on the 2,184 MW project on India's western coast (near Bombay, which is
the capital of Maharashtra) that reportedly will be the langest natural gas-fired power project in the
country upon its completion. Some reports suggest that it is the largest natural-gas plant in the world
The plant is in the midst of its first operational phase (with 750 MW up and running) and is scheduled to
begin its second phase (1,444 MW) in June. The company that owns and operates the power project is
Dabhol Power Company, in which Enron holds a 65-percent interest (the state of Maharashtra owns the
other 35 percent). Under terms of the contract, the state of Maharashtra agreed to purchase the totality of
power produced at Enron's plant

However, problems began to surface over the last six months or so, heightened by Maharashtra's recent
default on payments to Enron. Dabhol Power has been criticized for charging 7.1 rupees per kilowatt-
hour, compared with the market's average of 1.5 rupees (for conversion purposes, $1 equals 46.93
rupees). Citing what it claimed were high costs charged by Dabhol, the state of Maharashtra reportedly
refused to pay for any power produced from the second phase of the Dabhol plant. At last count, the
state government owes Enron approximately $48 million for power transactions completed last
December and January, and could owe $607 million if the contract is terminated.

Citing payment defaults by the state of Maharashtra and non-cooperation from both the state and federal
government in India, Enron issued a preliminary notice to terminate future power sales from its Dabhol
plant. Enron also declared a state of force majeure, a legal strategy that allows a company to break a
contract for reasons beyond their control. In response, Indian leaders-driven by valid concerns about the
financial repercussions that a broken contract would have-are requesting the country's federal
government to intervene and prevent any break in the contract, Lenders such as the State Bank of India,
the country’s largest commercial bank, also plan to fight Enron on its plans to rescind the contract

As noted, Enron's problems in India are causing a damaging domino effect for the undeveloped country.


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2)
May 22, 2001
Enron Locked in Contentious Battle over Indian Project

By Will McNamara



once in court the company disclosed that the contract with the California universities no longer
represented an economic business strategy and that the company was actually losing money on the
contracts (although it would not confirm a specific amount)

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Copyright 2001, SCIENTECH, Ine, All rights reserved.



keynote speaker, Capitol Contacts Breakfasts; noon, Capitol Hill
visits. Hotel Washington, 515 15th St., NW. Contact: 703-684-
2400,

FOREIGN AFFAIRS

News conference to introduce a resolution opposing China's bid to
host the 2008 Olympics. Participants: Reps. Tom Lantos, D-Calif.,
Christopher Cox, R-Calif., Nancy Pelosi, D-Calif., and Frank
Wolf, R-Va. House Radio/TV Gallery, Capitol. 9:30 a.m, Contact:
Paul Wilkinson, 202-225-6168. (New.)

News conference on U.S. policy toward North Korea. Participant:
Rep. Barney Frank. House Radio/TV Gallery, Capitol. 11:30 a.m.
Contact: 202-225-5931. (New.)

Senate Caucus on International Narcotics Control. Hearing to
examine the use and effects of the drug Ecstasy. 216 HSOB. 9:30
a.m. Contact: 202-224-9032. (New.)

HEALTH

American Lung Assn. news conference to support for the
Comprehensive Tuberculosis Elimination Act of 2001. Participants:
Reps. Sherrod Brown, D-Ohio, Constance Morella, R-Md., and Rep,
Henry Waxman, D-Calif. 6-318 RHOB. 10:30 a.m. Contact: Diane
Maple, 202-785-3355,

House Leadership

House GOP Conference. Closed meeting on party issues. Stakeout,
Center Steps Hallway. HC-5, Capitol. 9 a.m. Contact: 202-225-
$107, (New.)

SCCIAL ISSUES

News conference on the president's charitable choice initiative.
Participants: House Speaker Hastert, Republican Conference
Chairman J.C. Watts, Jr., R-Ok: and Rep. Tony Hall, D-Ohio.
311 CHOB. 10:15 a.m, Contact: 2 25-2800. (New.)

News conference to introduce the Clear Your Good Name Act,
legislation that would help those marked for life with voided
arrests. Participant: Rep. Jerrold Nadler, D-N.Y¥, 2226 RHOB.Noon.
Contact: 202-225-5635. (New.)

Democratic Caucus Task Force on Children. News conference to
unveil a task force report on how President Bush's budget outline
would cut valuable children's services. Particip : House
Minority Leader Gephardt, Reps. Martin Frost, D-T » Resa
DeLauro, D-Conn., and Lynn Woolsey, D-Calif. HC-9, Capitol, 11:30
a.m. Contact: 202-225-5161. (New.)

Call To Renewal. Breakfast reception and congressional dialogue
on “Facing the Divide: Mobilizing Networks to Overcome Poverty.”
Sa.m., Congressional Dialogue, Participants: Reps. Mark Souder,
R-Ind. Charles Stenholm, D-Texas, and Tony Hall, D-Ohio; Sens.
Rick Santorum, R-Pa., and Sen. Paul Wellstone, D-Minn. B-340
RHOB, 8 a.m. Contact: Kim Priore, 202-328-8745. (New.)

Violence Policy Center special investigations briefing on “Lying
and Buying: Using False Information to Obtain Firearms.”
Participants: Rep. Henry Waxman, D-Calif., and Kristen Rand,
legislative director, VPC. 2203 RHOB. 9:30 a.m. Contact: Naomi
Seligman, 202-822-8200. (New.)

TAXES

News conference to introduce tax components of the faith-based
initiatives plan. Participants: Sens, Rick Santorum, R-Pa., and
Joseph Lieberman, D-Conn. Senate Radio/TV Gallery, Capitol. 11
a.m, Contact: Robert Traynham, 202-224-0610. (New.)

TRANSPORTATION

News conference to introduce legislation, the Railroad Retirement
and Survivors" Improvement Act. Participants: House Resources
Chairman Young, Reps. James Oberstar, D-Minn., Jack Quinn, R-


From; Wolin, Neal
Sent: Thursday, February 21, 2002 1:07 AM
To: SearchCameo
CAMEO Recon found a word: Enron, Ken Lay sent by ca-del@nationaljoumnal.com to
John.duncan@do.treas.gov, neal.wolin@do.treas.gov on 3/21/2001 2:13:37 AM

This message was found to have a Critical Word in it. Message Sent to

john. duncanfdo.treas.gov; neal.wolin@do.treas.gov, From ca~del@nationaljournal.com, CC to
+ Date 3/21/2001 2:13:37 AM, Subject of message National Journal's CongressDailyAM -
Wednesday, March 21, 2001

Word(s} found: Enron, Ken Lay

“Original Message-----

Prom: ca-del@nationaljournal.com

Sent: 3/21/2001 2:13:37 AM

Received: 3/20/2001 11:14:56 PM

To: jotn.duncan@do.treas.gov, SMTP: john.duncan@do.treas.gov
neal.wolin@do.treas.gov, SMTP:neal.wolin@do.treas.gov

cc:

Subject: National Journal's CongressDailyAM - Wednesday, March 21, 2001
Body:

National Journal's CongressDailyAM

Tasue date: March 21, 2001

CongressDailyAM is now on the Web:
hetp://wew. national journal. com/pubs/congresadaily/

It's easy to use, plus you also get access to the afternoon
edition, Markup Reports, the searchable archive of stories
and more.

You may need a username and password to access the site.
If you don't have them, call #00-207-8001 today.

BUDGET
Stack Of Democratic Amendments Awaits FY02 Budget Markup

Republicans and Democrats will offer their competing visions
for federal tax and spending policy at today's House Budget
Committee markup, as Budget Chairman Nussle presents a budget
plan that essentially mirrors the blueprint President Bush
recommended last month. Democrats will counter with a plan to
divide surpluses into thirds for tax cuts, debt relief and
spending priorities.

In one significant departure from the president's budget,
Nussle’s proposal will not assume the collection of revenues from
leases to drill for oil in the Arctic National Wildlife Refuge.
Nussle told reporters that that hot-button political issue “is a
battle we didn't want to fight in the budget.” Nevertheless,
Wussle called Bush “a full, complete, total partner in this
budget.”

Nussle said his budget proposal includes reconciliation
instructions for four separate tax bills that equal $1.62
trillion over 10 years and for a $153 billion Medicare reform
bill, But he conceded that given the Senate's reluctance to
provide reconciliation instructions for more than one tax bill,
and none for Medicare, the matter would ultimately have to be
decided in conference.



Greg Mueller, was formed to promote the Bush agenda. It has
already run similar ads targeting Sen. Mary Landrieu, O-La, in
Louisiana.

The ads targeting Johnson will cun at least a week, according
to an IMC official, and will be broadcast throughout the day on
major radio stations in the state.

Similar radio spots aimed at Sen. Max Cleland, D-Ga., may
begin next week. The group also is contemplating television ads.
Despite its huge war chest, the IMC so far has done only a
week of ads on taxes in Louisiana and another spot in New York

promoting the nomination of Attorney General Ashcroft.

“We ha lot of time,” the IMC official said, noting that
Senate consideration of the Bush tax cut "could take months.” <=
By Geoff Earle and Keith Koffler, with Mark Wegner contributing

TRADE
Jordan Trade Agreement Provisions Draw Ire Of U.S. Chamber

The U.S. Chamber of Commerce will actively oppose ratification
of a trade agreement with Jordan because of its labor and
environmental provisions, the organization's president told the
Senate Finance Committee Tuesday.

“We will use the resources of the Chamber to oppose the Jordan
Free Trade Agreement because of the extraneous issues in it,”
Thomas Donohue, the Chamber president, said.

He referred to the agreement as “a cute little effort" to tie
mational security issues to domestic political interests and
warned, “It is mot going to fly.”

Some key congressional Democrats have hailed the Jordan
agreement as a possible template for future trade agreements
because it would require both countries te uphold their own labor
and environmental laws.

But witnesses told the panel Tuesday that the Jordan deal
would be of limited use in writing trade agreements with other
individual countries or in crafting a bill to renew trade
promotion authority, or fast track,

Michael Smith, who served as a deputy U.S. trade
representative during the Reagan administration and who staunchly
opposes inclusion of labor and environmental standards in trade
deals, said the provisions in the Jordan agreement are far too
vague to b any use in writing other trade pacts. Finance
Chairman Grassley said he shared that concern.

Even backers of the Jordan deal, including former U.S. Trade
Representative Barahefsky, who helped negotiate it, agreed that a
“cookie cutter” approach would not work.

dust the same, Barshefsky Tuesday urged speedy approval of the
Jordan pa To that end, she and other witnesses came out
strongly against a proposal by Trade Representative Zoellick to
bundle the Jordan agreement with other items in an ommibus bill
that would include trade promotion authority.

“Nations are not fungible," she said. "What may work for one
nation may net work for another nation."

Former National Security Adviser Samuel (Sandy) Berger
implored the committee not to delay the Jordan agreement and use
it “as a canvas where we act out other issues."

Leoking te Jordan's efforts to reform its economy and the
importance of that effort to Middle East stability, he said, TM
are playing with real bullets here.”

AFL-CIO President John Sweeney also called for swift
consideration of the Jordan deal, saying "it could not be more
reasonable or moderate.” But Sweeney referred to the pact only as
significant first step” and said his organization does not see
it as a "template for fast track" because that debate would
involve an "entirely different set of issues."

Sen. John Kerry, D-Mass., said bundling trade bills was "a
very bad idea.” He said the Bush administration and other



veterans’ programs by $1.2 billion in FY02, providing $3.8
billion in FY02 and $43.8 billion over 10 years. -- By Lisa
Caruso

-=-s-s-s-=.

POLITICS
Parties Deadlocked Over Senate Ratios

Senate Republicans and Democrats remain deadlocked over party
representation on House-Senate conference committees, with the
standoff threatening to prevent Republicans from moving any part
of President Bush's agenda except tax and budget issues until it
is resolved.

"Neither leader at the moment is even hinting that they will
budge," said Sen, Robert Bennett, R-Utah.

No significant negotiations are taking place on the issue,
sources said.

Senate Majority Leader Lott insists that Republicans need to
maintain a one-vote party edge when conferences meet on
legislation. But Minority Leader Daschle has called for equal
representation to reflect the Senate's 50-50 split.

The two leaders set aside the contentious issue late last
year, when they negotiated a broad, power-sharing arrangement
that provided for equal representation on Senate committees.

With the passage in both chambers of bankruptcy reform
legislation, the issue has re-emerged, and both sides remain
entrenched.

“The one thing the majority cannot give up is having a
majority on conference committees,” said Judiciary Chairman
Hatch, who managed the bankruptcy bill on the Senate floor. "If
you don't have that, you don't have anything.”

Republicans fear that without a one-vote advantage, they might
not be able to get legislation out of conference,

"You give the Democrats a veto over anything you can do,” said
a GOP leadership aide. "They literally have a veto unless we meet
their price 100 percent.”

The aide noted that conference committees have no mechanism
for discharging legislation if conferees cannot reach agreement.
Republicans negotiated a provision in the power-sharing
arrangement that allows legislation to come to the floor even if
committee members are deadlocked.

By contrast, on conference committees, “You are literally over
a@ barrel,” said the aide,

But as in the earlier negotiations, Democrats maintain some
leverage, since Republicans are seeking te move the president's
agenda.

Hatch said the issue has led to a “quagmire,” but insisted
that Republicans need to stand firm on the issue. Asked whether
the standoff could delay major legislation over a period of weeks
or months, Hatch said, “It may be that that’s the way life has to
be."

Republicans would still be able to move budget and tax
reconciliation legislation, because budget law prevents
filibusters on the budget resolution and on reconciliation. So
Republicans would need only a Sl-vote majority to appoint
confer on the measures, presumably with Vice President
Cheney's vote.

Meanwhile, Republicans are hoping to avoid the issue as it
relates to bankruptcy by having the House take up the Senate-
passed bill.

Lett said House and Senate staff members were negotiating
differences between the two versions, and the current plan was
for the House to take up the Senate bill and amend it.

“The modification will basically take the bill back pretty
close to where it was last year,” he said. He said that when the
bill comes back, "the Senate might be able to move it on down.”

But Lott noted that Democrats have employed delaying tactics



N.¥.3; and Bob Clement, D-Tenn. 2253 RHOB. 2:30 p.m. Contact:
Steve Hansen, 202-225-7749 or Jim Berard, 202-225-6260. (New.}

TELECOMMUNICATIONS

News conference on the Cell Phone Consumer Act. Participant: Rep.
Anthony Weiner, D-N.¥. House Triangle, Capitol. 12:15 p.m,
Contact: 202-225 6616

(New.)

OFF THE HILL TODAY

Campaign Finance

American League of Lobbyists addr by Sen. Chuck Hagel, R-Neb.
Washington Court Hotel, 525 New Jer: Ave., NW. 8:30 a.m,
Contact: Patti Jo Baber, 703-960-3011. (New.}

FOREIGN AFFAIRS

U.S.-Mexico Chamber of Commerce border issues conference. Agenda:
8 m., Rep. Silvestre Reyes, D-Texas; 9:30 a.m., Reps. Bob
Filner, D-Calif., and Heather Wilson, R-N.M.2 1] a.m., Reps.
Susan Davis, D-Calif., and Duncan Hunter, R-Calif.; 1 p.m.,
House Minority Leader Gephardt; 3 p.m., Reps. Ruben Hinojosa,
D-Texas, and Jim Kolbe, R-Ariz. Thomas Jefferson Building,
Library of Congress, 10 First St., SE, Members Room. 8 a.m.
Contact: 202-225-4831

Inmigration

Committee for Economic Development policy forum on reforming
immigration. Participanta: Rep. Zoe Lofgren, D-Calif., luncheon
and keynote speaker. National Press Club, 14th and F St., NW,
Holeman Lounge,Washington, DC.Noon. Contact: 202-223-0776.
(Revised.)

SOCIAL ISSUES

National Assn. of Housing and Redevelopment Officials legislative
conference. Participant: HUD Secretary Mel Martinez. J.W.
Marriott Hotel, 1331 Pennsylvania Ave., NW. & a.m. Contact: 202-
289-3500. (Revised.)

National Coalition Against Domestic Violence news briefing to
urge Congress to fully-fund FY02 programs combating violence
against women. Farticipants: Sen. Paul Wellstone, D-Minn., Reps.
Constance Morella, R-Md., Sue Kelly, R-N.Y., Judy Biggert, R-
Tll., and Asa Hutchinson, R-Arck, Reserve Officers Assn.,
Congressional Hall of Honors, One Constitution Ave,, NE. 9:30
a.m. Contact: 202-745-1211. (New.)

TRANSPORTATION

National Press Club Morning Newsmaker Program holds a discussion
on passenger: rights regarding airline delays and cancellations.
Participants: Rep. Peter DeFazio, D-Ore., and Rep. Louise
Slaughter, D-N.Y¥., plus Consumer Travel Rights Center and
Consumers Union representatives, National Press Club. 9 a.m.
Contact: 202-662-7593

THURSDAY
=SENATE COMMITTEES=

AGRICULTURE,

Food Oversight

Full committee oversight hearing of the Food Safety and
Inspection Service. 216 HSOB. 9 a.m. Contact: 202-224-2035.

APMED SERVICES

Defense Funding

Pull committee hearing on proposed legislation authorizing funds
for FY02 for the Defense Department and the future years Defense
program, focusing on military strategy and operational
requirements. NOTE: This hearing will be followed by closed


Calif power talks aim to reach solution on Saturday

WASHINGTON, Jan 12 (Reuters) - Treasury Secretary Lawrence
Summers, other senior Clinton administration officials and top
executives of electric power companies tentatively planned to
meet on Saturday to finalize a fix for California's power mess,
4@ source close to the negotiations said on Friday.

The high-level meeting was set to take place at the Energy
Department at 3:30 p.m. EST (2030 GMT), with some California
officials participating via teleconference, the source said.

The s fowly averted rolling power blackouts on
Thursday as already tight supplies of electricity fell to
dangerously low levels because of a severe storm.

Friday marked the fourth day of negotiations among
lower-level aides to map out detailed proposals for short- and
long-term solutions to California's chronic electricity
shortage and skyrocketing prices.

If the Friday talks failed to make as much progress as
hoped, the Saturday session could be downgraded to another day
of negotiations among lower-level officials on technical
issues, according to another source.

Summers and Energy Secretary Bill Richardson launched the
negotiations on Tuesday to prevent the bankruptcy of PG&E Corp
<PCG.N> and Edison International <EIX.N>, which could ripple
throughout the national economy,

Both utilities say they have run out of cash because of
runaway prices wholesale power, which are now tenfold higher
than one year ago. Under California's landmark 1996
deregulation law, the higher wholesale prices cannot be passed
through to consumers.

The two utilities want a $0-day reprieve in repaying
billions of dollars to out-of-state power generators, as well
as the ability to sign long-term contracts to lock in lower
prices.

( (washington, commodsenergy.news room@reuters.com) |

REUTERS
Rte 15:29 01-12-01

sTICKER: PCG EIX

?SUBJECT: CRUD COBO MU ENER UTIL USA
Copyright [c) 2001 Reuters

Received by NewsEDGE/LAN; 1/12/01 3:24 PM

“DJ POWER POINTS: By The Numbers, Calif Pwr Deal Leoks Good

Dow Jones International News Service via Dow Jones

By Mark Golden
A Dow Jones Newswires Column

NEW YORK (Dow Jones)--Grandstanding by negotiators in Washington, D.C., on the
California electricity crisis indicates the sides are too far apart for an
agreement this weekend, but the actual numbers involved raise the question: How
can they not get this done?

California Gov. Gray Davis, on behalf of the utilities that contribute so
generously to his campaign funds, is demanding three-year supply contracts at
5.5 cents a kilowatt-hour. "We've got to stop the hemorrhaging of utility cash,
but I can’t possibly have another rate increase or any state bailout,” the
governor is saying.

According to sources, U.S. Treasury Secretary Lawrence Summers and the


kind. SCIENTECH's sole purpose in publishing its IssneAlerts ts to offer an independent
perspective regarding the key events occurring in the energy industry, based on its long-standing
reputation asan expert OW CHTRY ISSUES,

Copyright 2001, SCIENTECH, Ine, All rights reserved.



Being the intemational energy giant that it is, Enron probably won't suffer too much if it does indeed
terminate its contract with the Indian government, and perhaps can find another buyer in the country for
the power produced by the Dabhol plant. Enron also has reportedly pulled out from all of the other
projects in India in which it had once planned to invest, including Metgas (a liquefied natural-gas
pipeline) and India-based projects led by Enron Broadband Services and Enron Oil & Gas. This ongoing
divestiture in India should reduce the company’s risk exposure related to the country’s instability

On the other hand, the failed contract will most likely do a fair amount of damage to the energy market
in India, which is already perceived as a less than lucrative country in which to develop power projects.
Some reports have indicated that India received only $2.6 billion in foreign investment in 2000,
representing three times less than Singapore, a country representing only one-fourth of the economy of
India. Any deterrent toward further power expansion in India would exacerbate concems about the
country's ability to meet growing demand for electricity

Further, at least four foreign power companies (Cogentrix of the United States, EDF of France,
Powergen of the United Kingdom, and Daewoo Corp. of South Korea) already have pulled out of the
Indian energy market. At the same time, many domestic companies also have postponed their own
power projects as a result of legal obstacles. In addition to a tainted reputation, Indian leaders also stand
to lose financially as well, as loans given to the Indian government reportedly are not covered by any
guarantee (unlike overseas lenders who are protected by guarantees).

Enron's announcement that it intends to terminate the contract has triggered a “cooling period” that will
last for six months, during which time the Indian federal government will continue trying to convince
Enron to maintain its end of the contract. Interestingly, in early May Enron said that it had “no
immediate plans” to sell its stake in the Dabho! power project and added that it would make no move on
the plant until the payment disputes with the state of Maharashtra are resolved. Other statements made
by Enron Chairman Kenneth Lay have suggested that the company might continue to own the Dabhol
project and proceed with the completion of the second phase, regardless of any payment that
Maharashtra may or may not make. Given the sharp increase in demand that is expected in India, it
would make sense for Enron to want to retain its majority ownership of the power plant and work a deal
to sell its power to another Indian buyer.

Enron has been fairly consistent with regard to its strategy of not owning hard assets on any long-term
basis. Typically, Enron has accumulated infrastructure in various commodities (¢.2., electricity
generation, natural gas, bandwidth) in order to ensure that it can provide a product where the customer
wants it. However, once Enron has established itself within that commodity, all it really needs is access
to the infrastructure, rather than outright ownership, so divestiture has typically followed. The company
might have perceived the Indian market to offer unique opportunities, due to the lack of infrastructure
across the country. However, now it appears that Enron's majority ownership in the Dabhol plant may be
causing more for the company than the assets are worth.

The possible termination of the Dabhol contract with the state of Maharashtra would mark the third sales
deal that Enron has broken in recent months, Most recently, the company announced that it is bowing
out of $43.5-billion project to route Qatari gas to the United Arab Emirates and has sold its stake in
Dolphin Energy to UAE Offsets Group for an undisclosed amount.

In addition, Enron is being sued by a group of California universities over the schools’ claim that the

company breached a four-year contract, signed in 1998, to provide power at a 5-percent discount to the
utility rate frozen by California's 1996 deregulation law. Scheduled to expire in 2002, the deal between
Enron and the California university system included a peak power load of 350 MW and is estimated to
be worth about $500 million. Although Enron cited problems associated with California's energy crisis,


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of talks with lower-level officials.

California's 1996 law deregulating the electricity market,
once hailed a model for others, lies at the core of the
problem. The law forced utilities to sell off much of their
generating capacity, prohibited them from signing long-term
contracts to buy supplies, and barred increases in consumer
rates until 2002,

MORE TALKS ON SUNDAY

U.S. Energy Department officials said the next round of
talks would take place in California on Sunday.

Tuesday is considered crucial because that is when Wall
Street traders and analysts return to work after a three-day
U.S. holiday weekend. Financial markets have been anxiously
watching the negotiations to evaluate the bankruptcy threat to
PGSE and Edison.

“There are an awful lot of things still in play,” said
James Hoecker, chairman of the Federal Energy Regulatory
Commission and one of the negotiators.

Hoecker and his independent federal agency with
jurisdiction over interstate electricity markets have been
sharply criticized by California officials for refusing to slap
a cap on wholesale power prices throughout the western region.

Negotiations began in Washington last Tuesday aimed at
finding both immediate and long-term solutions to California's
power woes. The two dozen officials involved broke into several
working groups during the week to focus on different issues.

Sources close to the talks told Reuters that progress had
been made on key issues such as allowing PGéE and Edison to
enter into long-term supply contracts with power generators,
something current state law prohibits.

Progress was also made, according to the source, on
out-of-state generators giving PG6E and Edison a grace period
of 90 days to pay their debts, pending a state guarantee of the
amounts owed.

"The generators are looking for that state guarantee,” the
source said.

Another provision under discussion would aim to cap
wholesale prices at a more reasonable level for long-term
contracts. And out-of-state power generators were pressing for
a final plan to require the state to take on a new role by
purchasing some wholesale power and reselling it te utilities.

CONSUMERS WATCHING OUTCOME

Consumer advocacy groups have been keeping a close eye on
the negotiations.

They have denounced any attempt to allow the utilities to
pass through the soaring wholesale power prices charged by
out-of-state generators, saying the industry has enjoyed big
profits since deregulation and should have been better prepared
for the state's current tight supplies.

The power emergency has pitted California utilities against
out-of-state power generators such as Dynegy Inc. <DYN.N> and
Reliant Energy <REI.N>, who sold extra electricity to PGSE and
SoCal Edison at rising spot market prices.

Wholesale power sold on California's spot market briefly
soared above $1,000 per megawatt hour but has since fallen to
around $320 per megawatt hour -- still expensive compared to
$34 per megawatt hour one year ago.

Another key participant in the talks has been Ken Lay, the
chairman of Enron Corp. and an energy adviser to
President-elect George W. Bush.

{ (washington. commodsenergy.newsroom@reuters.com) }
REUTERS
Rte 01:30 01-14-01


ANTRAK. (Rescheduled from Feb, 28.) 2358 RHOB. 10 a.m. Contact:
202-225-2771.

Treasury Appropriations

Treasury-Postal Subcommittee hearing on FY02 appropriations for
treasury inspector general and treasury inspector general for tax
administration, 2359 RHOB. 10 a.m, Contact: 202-225-2771.

FyY02 Appropriations/VA-HUD

VA-HUD-Independent Scommittee hearing on FY02 appropriations. H-
143, Capitol. 9 a.m. Contact: 202-225-2771.

VA-HUD-Independent Scommittee hearing on FY02 appropriations. H-
143, Capitol. 1 p.m. Contact: 202-225-2771.

ARMED SERVICES

National Security

Full committee hearing on national security. Witnesses: former
House Speaker Gingrich and former Sen. Gary Hart, D-Colo., 2118
RHOB. 10 a.m. Contact: 202-225-4151.

BUDGET

Budget

Pull committee markup of the PY02 budget resolution. 210 CHOB. 10
a.m. Contact: 202-226-7270,

Education and the Workforce

Committee Organization

Full committee markup of the committee oversight plan and
amendment to the committee rules. 2175 RHOB. 10:30 a.m. Contact:
202-228-4527,

Energy and Commerce

Airline Mergers

Commerce, Trade and Consumer Protection Subcommittee hearing on
airline mergers and consumers. Witness: Rep. Louise Slaughter, D-
N.Y. 2322 RHOB, 10 a.m. Contact: 202-225-2927. (Revised.)

E-Mail

Telecommunications and the Internet Subcommittee markup on
4LR.718, the Unsolicited Commercial Electronic Mail Act of 2001.
NOTE: This markup may extend to subsequent days as necessary.
2123 RHOB. 10 a.m. Contact: 202-225-2927.

Financial Services

Fee Relief

Capital Markets and Securities Subcommittee markup of the
Investor and Capital Markets Fee Relief Act. 2128 RHOB. 10 a.m,
Contact: 202-225-7502.

Business Checking

Financial Institutions and Consumer Credit Subcommittee markup of
H.R.974, the Small Business Interest Checking Act, and H.R.1009,
the Business Checking Freedom Act. 2126 RHOB. 2 p.m. Contact:
202-225-7502.

GOVERNMENT REFORM

Pennsylvania Ave.

District of Columbia Subcommittee hearing on the future of
Pennsylvania Ave. in front of the White House. Witnesses: DC
Mayor Anthony Williams, DC Council Chairman Linda Croppy John
Parsons, associate regional director of lands, resources and
planning, National Park Service. 2154 RHOB. 10 a.m. Contact: 202-
225-5074.

Pending Business

Government Efficiency, Financial Management and Intergovernmental
Relations Subcommittee markup of pending matters, 2247 RHOB. 10
a Contact: 202-225-5074. (Revised.)

International Relations

FOREIGN RELATIONS
Full committee markup of the Foreign Relations Authorization Act
for FY02 and FYO3. 2172 RHOB. 10 a.m. Contact: 202-225-5021.


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OSCIENTECH
IssueAlert.

July 11, 2001

TradeSpark Emerges as Leader in Online Trading,



However, it is clearly Enron that blazed the trail for online energy trading and remains the king of this
market. As of the end of 2000, Enron had traded $336 billion worth of commodities on EnronOnline, led
by electricity and natural gas (Enron also trades other commodities such as bandwidth and paper). As of
late June, it has been reported that the notional value of all transactions on EnronOnline exceeded $650
billion, and the exchange's daily volume has soared to about 5,000 trades. Yet, while Enron may still be
the largest online energy exchange, TradeSpark’s recent growth is quite impressive, especially
considering that EnronOnline had a one-year jumpstart on all the other trading exchanges that
subsequently formed. TradeSpark maintains that it has transacted $30 billion worth of energy products
{notional value) since its October 2000 launch. Further, the dollar amount traded on the exchange has
grown steadily, from $12 billion in 4Q 2000 to $18 billion in 1Q 2001. Obviously, there is still a huge
gulf in notional transactions that separates EnronOnline from TradeSpark, but among the list of other
trading exchanges (such as Intercontinental Exchange, Dynegydirect and HoustonStreet) TradeSpark
appears to be the one that shows real potential of becoming a true competitor to EnronOnline.

In any comparison between the two exchanges, it is important to establish the key element that makes
TradeSpark unique from EnronOnline. TradeSpark is a multi-buyer / multi-seller trading exchange that
offers anonymous bidding to an open market of traders, EnronOnline, on the other hand, is a proprietary
trading exchange. In other words, in every transaction that takes place on EnronOnline, Enron
participates as either a buyer or a seller. TradeSpark says that about 54 percent of its average daily
transactions originate from activity between non-partners (companies that were not original founders of
the exchange). This statement indicates that liquidity is growing at a steady pace on the TradeSpark
exchange. While the majority of TradeSpark’s traders appear to be non-partner members, it is important
to note that the founding members mentioned above receive incentive payments in the form of warrants
if TradeSpark is successful. In other words, should TradeSpark hit $250 million in revenue by its fifth
year, eSpeed would make available 8 million warrants at a strike price of $27.94 to the founding
members of TradeSpark. Thus, the founding members are more inclined to participate on the exchange,
which in tum sparks interest from other participants and increases TradeSpark's liquidity

‘The neutrality issue is arguably the most important distinguishing feature between EnronOnline and
TradeSpark, and could be the one factor that is presently driving TradeSpark’s success. Many traders
who participate on various exchanges have expressed a preference for those marketplaces that offer
multiple buyers and sellers. As is the case with EnronOnline, when a trader knows that a particular
company is always a participant as a buyer or a seller in every transaction on their exchange, some
trading companies may be hesitant to reveal strategic information to the exchange-owning company. In
addition, regulatory pressures from the Federal Trade Commission may eventually make neutrality a
requirement, which is something that exchanges such as EnronOnline may have to address and
exchanges such as TradeSpark have already incorporated. When given a choice over various trading
exchanges on which to participate, my general impression is that traders would prefer to participate on
an exchange where issues of disclosing competitive information are not a concern.

T also think it significant that the bulk of TradeSpark’s trading volume is coming out of the natural-gas
business, While the exchange focuses on both natural gas and electricity instruments, in 2Q 2001,
TradeSpark's average natural-gas trading volumes increased from 100 million MMBTUs to a trading
high of 406 million MMBTUs on June 7, 2001. Further, TradeSpark has experienced a 90-percent
increase in the amount of natural-gas MMBTUs traded on the exchange, while the level of electricity
megawatt hours has increased by 17 percent. During the 1Q 2001 period, TradeSpark traded more than
2.18-billion MMBTUs of natural gas instruments (a notional value of about $11.6 billion) and 120-
million MWhs of electricity instruments (a notional value of about $6.4 billion)

Asa whole, the online trading market appears to be riding the wave of a major growth spurt. A study
conducted by AMR Research showed that 600 energy trading exchanges existed in April 2000. This


number grew to 1,500 by September 2001. A separate report conducted by Forrester Research indicates
that online trading in wholesale markets increased 750 percent from 1999 to 2000. The same report
projects that online trading volume will continue to grow, leaping from $400-billion market in 2000 toa
$3.6-trillion market in 2005.

Of course, not all of these exchanges are expected to be successful. In fact, the vast majority of them
will probably shut down or be forced to merge with another partner to ensure survival. As consolidation
continues within the online trading space, most projections suggest that two primary kinds of exchanges
will remain active. One of these exchanges is likely to be a liquidity hub that attempts to attract
members that want to exchange price risk in pure commodities, which is represented by EnronOnline,
Dynegydirect, ete. The other exchange that will survive will probably be a merchant platform that
attempts to bring multiple market players together, which is represented by TradeSpark, HoustonStreet,
Intercontinental Exchange, and others.

The primary challenge for all online trading exchanges is to establish liquidity, What traders appear to
want and what makes an exchange successful is liquidity, meaning essentially the amount of
transactions on the exchange and, consequently, the opportunity to access beneficial deals. TradeSpark’s
model has been unique due to the rush-to-market capability that the alliance with eSpeed supported, and
also the incentive program among its founding members, which apparently has played a role in
increasing participation on the exchange. The remaining half of this year should be fertile ground for
TradeSpark to exhibit continued growth. However, as consolidation continues to remain an undercurrent
in the online trading market, it is still rather premature to project which exchanges will remain in
operation once the dust settles.

An archive list of previous IssueAlerts is available at
www. scientech.com

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President Bush Tuesday signed a bill into law terminating
controversial Clinton administration ergonomics regulations--
drawing praise from business groups but condemnation from labor.

On Capitol Mill, advocates on both sides said the issue could
be revisited.

“Musculoskeletal injuries in the workplace are a very serious
issue, but there were significant problems with this regulation,”
said House Education and the Workforce Chairman Boehner.

Business interests had fought hard to kill the regulation,
saying it would cost them billions of dollars and override
voluntary programs already in place.

Labor groups supported the Clinton rule, which was overturned
earlier this month through the first successful use of the
Congressional Review Act.

Sen. John Breaux, D-La., who voted with five other Senate
Democrats to void the rule, has said he would push to introduce «
bill directing the Labor Department to develop a new rule.

In a statement released by the White House, Bush urged an
alternative to the scuttled regulation.

Bush said that he was signing the resolution because “in
exchange for uncertain benefits, the ergonomics rule would have
cost both large and small employers billions of dollars and
presented employers with overwhelming challenges.”

——

ENERGY
Tauzin, Barton Seek Ways To Ease Calif, Energy Crisis

Key Republicans on the House Energy and Commerce Committee
signaled willingness Tuesday to move legislation soon to help aid
consumers in California shocked by a mounting electricity crisis.

However, the Republicans said they would not introduce any
legislation unless they were convinced that congressional action
would do more good than harm.

House Energy and Commerce Chairman Tauzin and Energy and Air
Quality Subcommittee Chairman Joe Barton, R-Texas, said they
would take a look at near-term solutions to the California crisis
at a hearing on the issue.

Barton said he would make a decision by the end of the week.
If he does introduce a bill, it would be a departure from many
members of his party who have urged that California take care of
its own problems,

POLITICS
Martinez: Congress Should OK Larger Rental Housing Loans

HUD Secretary Martine> said Tuesday the government should
guarantee larger loans for companies that want to build rental
housing, while predicting the change would generate an additional
3,000 apartments, the Associated Press reported.

HUD wants Congress to increase the limit on Federal Housing
Administration loans by 25 percent, a proposal that was included
in President Bush's budget plan,

The department predicted that the change would allow for an
extra $300 million in construction of about 3,000 additional
units in 2002. It would not affect the federal budget because FHA
is self-funded by premiums paid by borrowers, HUD said.

Under law, HUD can only provide FHA insurance of about $40,248
per two-bedroom apartment, a figure that varies by region.

Since the limit on loan size was last increased in 1992,
construction costs in some areas have risen by 25 percent or
more, HUD said--arguing that tl increasing costs, coupled with
the static loan limits, have driven developers to more lucrative
projects.

eee

HEALTH


Beach area

The Deerfield Beach plant is classified as a peaking unit, in that it will only be allowed to generate
electricity in times of peak demand within the state. This morning, I spoke with Eric Thode, Enron's
spokesperson on the Deerfield Beach plant, and he clarified an important distinction about this proposed
facility. As compared with other plants that have had difficulty getting approved in Florida, the
Deerfield Beach plant will be a single-cycle unit (as opposed to combined-cycle) that can only operate
for 3,500 hours a year. The state’s Department of Environmental Protection will regulate the output of
this plant once it becomes operational. Further, the power generated during times of peak demand would
then be sold only to incumbent utilities in the state. Enron has also agreed to pay the city of Deerfield
Beach $1,5 million before construction begins on the plant, and at least $1.7 million in property taxes
annually. As with the proposed Pompano Beach plant, Enron plans to use diesel fuel as a backup at the
Deerfield Beach plant if natural gas if not available, which remains a concern among local residents.

In addition to the air quality permit, Enron probably will also have to receive water rights and other
environmental approvals, Although community groups that oppose the plant did not have an opportunity
to voice resistance before the plant was approved by the city's development committee, there will be
many subsequent checkpoints at which Enron may face public opposition. In addition, a pending vote on
June 26 by the Broward County Commission, which also has jurisdiction over the Deerfield Beach plant
area, may approve a one-year moratorium on any new power plants being built in the area. Enron has
said that such a moratorium would be illegal

Enron also wants to build a similar project in South Miami-Dade County, and thus is making a fairly
aggressive attempt to establish itself in Florida in anticipation of the state's becoming more competitive
However, Enron is not the only out-of-state energy company attempting to penetrate the Florida
wholesale market. For instance, El Paso Corp. wants to build natural-gas power plants in Deerfield
Beach and Belle Grande, Fla. In addition, Duke Energy spent three years trying to get approval to build
a combined-cycle merchant plant in New Smyma Beach, Fla. The North Carolina-based energy
company recently announced that it is abandoning all attempts to build the plant as a result of
bureaucratic and legal hurdles. In addition to legal hurdles, Florida Power Corp., Florida Power & Light
and Tampa Electric Company (TECO), the state's incumbent utilities, also aggressively opposed the
plant, arguing that a merchant facility in Florida owned by an out-of-state company would not be held to
the same market rules as incumbents (thus creating an imbalanced playing field in the state), The final
straw for Duke Energy seems to be the fact that, in its latest legislative session, Florida legislators did
not overtum the state’s prohibition against merchant plants being owned by out-of-state companies.

What was Duke Energy's loss appears to have become Reliant Energy's gain. Reliant Resources, the
unregulated wholesale operation that has partially spun off from its parent, announced that it has reached
an agreement with the Utilities Commission of New Smyma Beach to enter into an “exclusive
agreement” to continue developing the 500-MW plant that Duke abandoned. Reliant, of course, may
face the same restrictions that ultimately dissuaded Duke Energy from pursuing this project

Specifically, Reliant may need to address positioning this plant as a single-cycle unit in order to get
approval, or pursue a joint venture contract with an incumbent utility. If Reliant is successful where
Duke was not, Reliant will expand upon a generation portfolio in Florida that already includes 619 MW
in operation, 1,360 MW under contract; and 460 MW under construction,

Further, Southem Company has formed a partnership with the Orlando (Fla.) Public Utilities
Commission (OUC) to build a 633-MW, natural gas generation facility, which happens to mark
Southern's first planned expansion outside its traditional service territory. The Florida Public Service
Commission has signed off on a Certificate of Need filed by Southern Company, OUC and two other
partners—the Kissimmee Utility Authonty and Florida Municipal Power Agency, The project now goes


office in the Ronald Reagan State Building in downtown Los Angeles. They did
not, however, join him at the news conference announcing the plan.

Davis said the state intends to move forward “at warp speed," and urged
energy producers to begin making bids to the state immediately. It was not clear
whether the bids would be considered at an auction or through a more traditional
state bidding procedure.

The governor said the state expects to purchase power at "vastly reduced
rates," and he promised that consumers would not see any more rate increases.

The utilities said they needed some kind of relief by Tuesday, when they face
major debt payment deadlines.

One or both utilities could go bankrupt as early as Tuesaday, said some
involved in the talks.

The idea behind Davis' deal is that it would allow the state to guarantee a
return to stability for energy consumers--not only residential customers but
businesses whose future in California depends on the availability of reliable,
affordable energy.

Davis, a participant in the meeting said, indicated that he wants limits on
the state's liability and guarantees that its coffers would not be bled if it
enters the electricity business in a major way.

At one point, Assembly Speaker Bob Hertzberg (D-Sherman Caks) said that the
utilities would have to suffer more financial pain. Though it was not a topic of
the conference on Saturday, lawmakers have suggested receiving concessions from
utilities, ranging from a seat on their boards of directors to stock options for
consumers.

Davis said the utilities would not be getting back all the money they lost in
the state's runaway energy market last year. But he said it was important to
save them.

“Clearly, we want to avoid bankruptcy,” he said. "Our fate is tied to the
utilities’ fate. They know better than anyone how to keep the lights on."

Under the proposal, state government would strike long-term deals for
electricity, which it would sell in the state's energy marketplace. The state
also would push to restructure long-term contracts that utilities have with
wind, solar and other alternative power producers to lower the cost of
electricity.

For their part, utilities also would make power from their nuclear and
hydroelectric plants available for consumption in California, rather than
selling it in the market as they are required to do now. While consumers might
not have higher bills, the utilities could use the difference between what they
pay and the retail price to restructure their debt and pay it down over a period
of years.

Not present at the meeting, and apparently not invited, were any
representatives of consumers, who stand to ultimately pick up the tab for the
deal.

Harvey Rosenfield, head of the Foundation for Taxpayer and Consumer Rights in
Santa Monica, said consumer advocates had asked to be represented at the meeting
but were told there wasn't room,

“When politicians, bureaucrats and utilities get together behind closed
doors, it's always bad news for consumers,” he said. "You know the outcome is
going to leave consumers footing the bill.”

Political and business leaders say the sense of urgency surrounding the
negotiations can be explained by the fact that the state's situation is so dire


to shift California back to a system that relies more on government oversight of
energy markets.

A key remedy that negotiators tackled at this weekend's teleconference in
Washington and Los Angeles would have the state enter into long-term agreements
with power suppliers to buy electricity at fixed rates, then sell it te utility
companies, But some consumer groups are warning that such a deal could keep
consumer bills artificially high the next time market prices for energy drop.

Davis Says State Will Buy Power for Resale to Utilities

Electricity: The governor announces the plan for purchases at reduced
during a long conference of top officials. Other participants are
optimistic.

le.

Los Angeles Times via Dow Jones

Publication Date: Sunday January 14, 2001
Page A-1

Les Angeles Times (Home Edition)
Copyright 2001 / The Times Mirror Company
By DAN MORAIN and MITCHELL LANDSBERG
TIMES STAFF WRITERS

With California's major utilities teetering near bankruptcy, Gov. Gray Davis
announced a plan Saturday under which the state would buy power at reduced rates
and resell it to the battered companies to stabilize California's haywire
electricity market.

The proposal--meant to end the threat of blackouts and economic chaos in
California--came near the end of an extraordinary bicoastal video and telephone
conference in Washington, Los Angeles and Sacramento.

While Davis presided over a gathering in Los Angeles of two dozen top state
officials and energy company executives, U.S. Treasury Secretary Lawrence
Summers chaired the Washington end, flanked by top federal officials as well as
representatives of utilities and power generators.

Seven hours into the meeting, Davis, joined by legislative leaders, held a
news conference to proclaim a bipartisan agreement that could help solve
California's vexing energy problems. Davia said the Legislature would consider
the plan Tuesday.

He said the state would buy electricity through long-term contracts at rates
sharply lower than utilities have been paying. California would then resell it
to the companies at cost, although terms have not yet been determined.

As Davis made the announcement, however, participants in Washington ended
their meeting sounding glum about what had been accomplished.

“We're still digesting it," said Joe Bob Perkins, president and chief
operating officer of of Reliant Energy Wholesale Group.

And in Los Angeles, state Senate Republican leader Bill Campbell appeared
less than convinced that the state's ordeal was over. “I guess I'm encouraged,”
he said, adding, "The answer is going to be in the numbers."

Those numbers would be the price of energy the state can negotiate, and the
length of the contract the producers demand.

Earlier in the day, Summers had asked Davis to hold an auction in which
generators and middlemen would sell electricity to the state, which would then
resell it to the utilities. The state's two biggest utilities, Pacific Gas 6
Electric and Southern California Edison, are so cash-strapped that they they
lack the credit to strike deals with some electricity sellers.

The top executives of the two utilities were at the table with Davis at his


generating company chief executives looked at Davis with a "What are you
amoking?" expression several times Tuesday night. The generators" stance is that
the market price is 8.5 cents/kwh and only if the contracts run for eight years,

But that's all just negotiating position. The customers of Edison
International's {EIX} Southern California Edison currently pay the company 7.6
cents/kwh just for energy. That price includes last week's one-cent raise, but
not other charges such as transmission and distribution.

Edison generates half the power it needs at a cost of about 3 cents/kwh. So,
purchasing the other half at 5.5 cents/kwh would do a lot more than stop the
hemorrhaging. If the cost of purchased power were 5.5 cents, Edison's average
cost would be 4.3 cents, for which they are getting paid 7.6 cents. That 3.3
cents/kwh profit on the 83 billion kwh Edison sells a year comes to a whopping
$2.7 billion annually. End of credit problem.

PG&E Corp.'s (PCG) situation is more difficult. Their customers pay less for
electricity, and PG&E only generates a third of its own power, but they have
lower generating costs than Edison. Bottom line: if PG&E could buy supplies at
5.5 cents/kwh, they would be left with 1.9 cents/kwh profit.

Unfortunately for the utilities, California independent generators, such as
Reliant Energy (REI), NRG Energy (NRG), Dynegy (DYN), Southern Energy (SOE) and
Duke Energy (DUK), can't get their prices down to 5.5 cents/kwh in California
given the current market price of natural gas.

But they don’t need anything close to 8.5 cents for eight years. The forward
price for wholesale power in California for the balance of this year is 16
cents/kwh for the on-peak hours, which is what the utilities mostly need to buy.
The on-peak price drops to 11 cents/kwh for a three-year contract because new
generators and new gas supplies are expected to come on line. For an eight-year
contract, the price drops to about 7.3 cents/kwh.

At 7.3 cents, PG&E would be heading to bankruptcy court. But the generators
will get to sell PG&E some off-peak power, too, which brings the average price
down a little further. If the governor guarantees really quick licensing for a
couple of new power plants in northern California, the price comes down a lot.

What's more, to save deregulation in the U.5. the generators are willing to
cut to the bone. The stocks of Dynegy, Enron Corp. (ENE), etc., have high
price-to-earnings ratios because their earnings are expected to continue strong
growth under electric deregulation. They are the emerging masters of a
deregulated universe, but if deregulation were to throw PG&E and Edison into
bankruptcy court, there wouldn't be any deregulated electric universe to master.

As one electricity trader put it: "They have got to get a deal done. If they
don't get ‘The California Energy Crisis’ off of CNBC every 30 minutes, I'm going
to be out of a job."

Generators' stock prices have been getting hammered since the first of the
year due to eral factors, such as profit-taking after a great 2000, according
te Credit Su. First Boston utility analyst Paul Patterson. Duke's stock has
fallen to $66 from $85 since Dec. 29, for example.

Prices of generator stocks have come down hard, in part, because a California
catastrophe would derail deregulation in many states and the forecasts for
generators' earnings growth would be questioned, according to Solomon Smith
Barney analyst Ray Niles.

That's the finances. The physical reality is that the western U.3. probably
won't have enough electricity to meet demand for the rest of this year. Starting
in February, if a deal ia done, California utilities won't he the last in line
to get their power, and the threat of blackouts will be spread out across the
West.


is not seen as imminent.

Summers said state leaders had a “clear recognition” of
what the situation was, and would work in an “expedited” manner
te complete a settlement.
marked the fifth consecutive session of talks in
the nation's capital, and the second seven-hour meeting of the
top leaders, minus Energy Secretary Bill Richardson who missed
the Saturday session while traveling in the Middle East.

Technical discussions took place Wednesday through Friday.

The talks focused on core issues, such as plans for power
generators, owed billions by PGsE and Edis te delay seeking
money for a period of 90 days pending state assurances that the
debts would be paid.

Industry and government sources said the discussions were
also keyed on trying to establish the terms of long-term
contracts between power generators and utilities.

Long-term contracts would allow the utilities to hedge
against having to buy electricity in the spot markets. In
recent days wholesale power sold on the spot market has
commanded around $320 per megawatt-hour, compared to $34 one
year ago.

Wall Street analysts and sources close to the talks said
the state wants a price cap of $55 per megawatt hour for
long-term contracts, but that level may not be high enough for
out-of-state g ors who see $70-$90 as more reasonable.

Californi 996 law deregulating the electricity market,
once hailed a model for cthers, lies at the core of the
problem. The law forced utilities to sell off much of their
generating capacity, prohibited them from signing long-term
contracts to buy supplies and barred increases in consumer
fates until 2002.

{ (Washington Energy Desk, +1 202 898 6316 email:
washington. conmodsenergy.newsroom§reuters. com) )
REUTERS

White House says Calif. must act on power crisis
{recasts with meeting ends, new throughout)

By Patrick Connole

WASHINGTON, Jan 13 (Reuters) - Clinton administration
officials ended a marathon negotiating ion late Saturday
saying it was up to California lawmakers and the governor toe
finalize a plan by Tuesday to stave off bankruptcy for two huge
utilities,

Negotiators made some progress on two key issues, allowing
California's major power companies to reach long-term contracts
with power supplies, something that is now illegal, and getting
a grace period to pay debts, sources said.

Soaring wholesale power prices and an inability to pass
those costs on to consumers have drained more than $12 billion
from PG&E Corp <PCG.N> and Edison International <EZIX.N>.

With supplies of electricity already stretched to the
limit, a severe winter storm earlier in the week sent the
nation’s richest and most populous state perilously close to
rolling blackouts.

Gene Sperling, director of the president's National
Economic Council, made it clear that the ball was now in the
court of California Gev. Gray Davis and state lawmakers. They
must hammer cut a solution to the state's chronic power woes
over the next two days before Wall Street reopens on Tuesday.

“The governor laid out a framework for him and the
legislative leadership to work on,” Sperling told reporters
after a meeting with state officials and industry executives.
“The issue is now for them to work out the proposal.”

Treasury Secretary Lawrence Summers mediated the seven-hour
negotiating session, which took place after four previous days



From: ‘Squitien, Ray

Sent: Thursday, February 21, 2002 12:10 AM
To: SearchCameo
Subject: CAMEO Recon found a word: Enron sent by SCIENTECH IssueAlen to on 7/16/2001

8:39:20 AM

Issuedlert
7_16_01.hemnd
This message was found to have a Critical Word in it. Message Sent to , From
SCIENTECH IssueAlert, CC to , Date 7/16/2001 8:39:20 AM, Subject of message Enron Rebounds
in Second Quarter, But Still Faces Several Murdles

Word(s) found: Enron

From: SCIENTECH IssueAlert
Sent: 7/16/2001 8:39:20 AN

Received: 7/16/2001 2:32:34 EM

To:

cc:

Subject: Enron Rebounds in Second Quarter, But Still Faces Several Hurdles
Body:

swcece End of message body

Message auditing by MicroData CAMEO Recon


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Edges In On EnronOnline

By Will McNamara
Director, Electric Industry Analysis

[News stem front Renters] Online energy marketplace TradeSpark said on July 10 that it
traded products with a notional value of $41.9 billion in the second quarter of this year,
up from $18 billion in the first quarter. The rise in the second quarter brought the total
transaction value since TradeSpark’s October 2000 launch to $71 billion. According to
TradeSpark, during the second quarter the system was used to trade over 6.8 billion
MMBTUs of natural gas instruments, with a notional value of over $33 billion, a rise of
189 percent over the first quarter. It was also used to trade about 155-million megawatt
hours of electricity instruments, with a notional value of some $8 2 billion, a rise of 29

M@ percent over the first quarter

Analysis: As we have now reached the mid-year point, it is a good time to take a step back and assess
how the online energy trading market is being repositioned EnronOnline, which launched in August
1999, certainly has been the market leader since that time, but TradeSpark (on the basis of its strong
performance and one key distinguishing feature that sets it apart from Enron) has emerged as a
formidable player this year. In fact, 2001 could very well become the year that TradeSpark inches ever
closer to EnronOnline, closing the gap in what has become a highly saturated market. The online trading
space is prone to rapid consolidation and many players that emerged over the last year have found it a
daunting challenge to establish liquidity. However, other players (and TradeSpark is part of this group)
have taken full advantage of market volatility, the high cost of natural gas that was common earlier this
year, and the ongoing advances in Internet technology to forge ahead with a promising new business
model

For background, TradeSpark was formed in September 2000 by trading systems developer eSpeed, Inc
(Nasdaq: ESPD), brokerage Cantor Fitzgerald and several energy companies, including Dominion
Resources (NYSE: D), TXU Corp. (NYSE: TXU), Williams Cos, (NYSE: WMB), Koch Energy
Trading, and Royal Dutch / Shell unit Coral Energy. eSpeed has an equity stake in the TradeSpark
partnership. Through this equity stake, eSpeed is able to share in all potential upside value of
TradeSpark, based on an initial investment in the exchange of $2 million cash, representing a 5-percent
equity stake in the exchange. TradeSpark is creating one large liquidity pool by bringing together several
mediums, including the Intemet, voice brokering and eSpeed’s 300 millisecond private global network

The affiliation with eSpeed was particularly important as TradeSpark did not have to construct a trading
infrastructure, as it adopted the one that had already been put into place by eSpeed. This allowed
TradeSpark to enter the market earlier than many of its subsequent competitors and gain an important
first-strike advantage. The exchange offers trader services such as real-time prices for commodities,
maturities, delivery points, and other benchmarks of the market. eSpeed, an independent trading
company that spun off from Cantor Fitzgerald in 1999, provides the technology infrastructure that
supports the TradeSpark exchange, along with supporting other multiple buyer / multiple seller
electronic marketplaces. eSpeed is an end-to-end electronic trading system that can accommodate up to
150 transactions per second, per instrument, with an as-mentioned 300-millisecond execution time. The
customizable system displays all prices on the system anonymously to all market participants. Note that
even before the partnership with TradeSpark, eSpeed had received investments of $25 million each from
Dynegy and Williams to develop at least four new commodity-specific electronic spot and futures
trading marketplaces.


dust weeks after congressional Republicans used the
Congressional Review Act to cancel Clinton administration
regulations on ergonomics, a bipartisan group of senators is
planning to return the favor by forcing the Senate to vote on
whether to overturn President Bush's reimposition of the "Mexico
City" family planning policy.

Sens, Barbara Boxer, D-Calif., and Harry Reid, D-Nev.--along
with Republicans Olympia Snowe and Susan Collins of Maine, James
Jeffords of Vermont, Arlen Specter of Pennsylvania and Lincoln
Chafee of Rhode Island--Wednesday introduced a formal “resolution
of disapproval” of the rule published Feb. 15.

At a news conference, they also announced they have the 30
signatures needed to force a 10-hour floor debate on their
resolution.

“This has nothing to do with so-called “ergo payback,'” said
Reid. "This will stand or fall on its own merits.” But Boxer
conceded that the group "saw [this process) work in another a:
and we hope to use it to our advantage here.”

On his first business day in office--the anniversary of the
landmark abortion ruling, Roe vs. Wade--Bush ordered a return to
the policy in effect from 1984-93, It forbade U.S. funding of
international family planning organizations that use their own
funds to perform, counsel or advocate abortions.

The move pleased abortion opponents, who claim that although
no U.S. funds were used to pay for abortions, such funds were
subsidizing organizations like the International Planned
Parenthood Federation.

But the action angered not only abortion-rights supporters,
but also legislators like Reid--who opposes abortion but supports
family planning.

The Senate probably has the votes for the resolution--even in
the last Congress, a more anti-abortion Senate resisted House
efforts to reimpose the policy in legislation. The situation in
the House remains unclear. In that chamber, said Rep. Nita Lowey,
D-N.Y., the only way to force the measure to the floor would be
by discharge petition.

Lowey said she hopes if the resolution passes the Senate--
Boxer would not set a date, but said to expect a vote by early
Sune--a bipartisan group of House members might be able to
convince Speaker Hastert to allow a vote there.

And despite the fact that the resolution would overturn Bush's
action, backers said they hope that he might not veto the
measure-~should it reach his desk. “I hope that while we are
working on this, he might have second thoughts," said Boxer. =~
By Julie Rovner

TAXES
Gramm, Miller Developing A “Midcourse’ Tax Cut Review

Sens. Phil Gramma, R-Texas, and Zell Miller, D-Ga., said
Tuesday they are working on a potential tax-cut compromise that
would provide Congress with a mechanism to use a “midcourse
correction” to review the budget and tax outlook in future years.

Gramm said the mechanism would provide for an expedited vote
in the te that would be based on congressional discretion to
evaluate tax and spending proposals, depending on the budget
outlook,

Thus, “you're not locked into” removing scheduled tax cuts, he
said,

Gramm said the idea, which in still in development, compares
favorably to trigger proposals, proposed by several Republican
and Democratic centrists, that would tie tax cuts to projected
surpluses, Gramm said his mechanism would not require the
cancellation of tax cuts, as would triggers, but instead would
leave decisions to legislators.

“I'm not in favor and not going to support some straightjacket



From; Wolin, Neal

Sent: Thursday, February 21, 2002 1:10 AM
To: SearchCameo
Subject: CAMEO Recon found a word: Enron, Kenneth Lay, Ken Lay sent by Klasky, Helaine to Stem,

Todd; ‘brazos@@hotmail,com'; Gallagher, Una; Buck, Bill; Weaver, Elizabeth: Gensler, Gary;
‘Sachs, Lee; Sandberg, Sheryl; Summers, Larry; Moe, Martin; Wolin, Neal; Fland

This message was found to have a Critical Word in it. Message Sent to Stern, Todd;
‘brazos@hotmail.com'; Gallagher, Una; Buck, Bill; Weaver, Elizabeth; Gensler, Gary; Sachs,
Lee; Sandberg, Sheryl; Summers, Larry: Moe, Martins Wolin, Neal; Flanders, Stephanie;
Bordoff, Jason: Moore, Holly: Comstock, Neal; Wechsler, William: Klasky, Helaine; Smith,
Michelle A.; patrick_dorton@opd.eop.govs rsiewert@who.eop.gov, Prom Klasky, Helaine, CC to
» Date 1/14/2001 12:57:52 PM, Subject of message CA Energy Talks - Press Clips

Word(s} found: Enron, Kenneth Lay, Ken Lay

babes, Original Message--~~~

From: Klasky, Helaine

Sent: 1/14/2001 12:57:52 PM

Received: 1/14/2001 12:57:52 2M

Tot Stern, Todd, EXt/O=USTREASURY/OU*DO/CN*RECI PIENTS/CN#DOM3.DOPOS.SternT
*brazos@hotmail.com', SMTP:brazos@hotmail.com
Gallagher, Una, EX: /OsUSTREASURY/OU*DO/CN@RECI PIENTS/CN»GALLAGHERU
Buck, Bill, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=BUCKW
Weaver, Elizabeth, &X:/O=sUSTREASURY/OU=DO/CN=RECIPIENTS/CN=WEAVERE
Gensler, Gary, EX:/O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=GENSLERG
Sachs, Lee, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=SachsL
Sandberg, Sheryl, £X%:/O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=DOM3.DOPOS.SandbergS
Summers, Larry, £X:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=SUMMERSL
Moe, Martin, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CH=DOM3. DOPOS.MoeM
Wolin, Neal, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=WOLINN
Flanders, Stephanie, EX: /O=USTREASURY/OU=DO0/CN=RECIPIENTS/CN=DOM3.DOPOS. FLANDERSS
Bordoff, Jason, EX: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=DOM3.DOPOS.BordoffJ
Moore, Holly, EX: /O=USTREASURY/OU=D0/CN*RECIPIENTS/CN=DOM3.DOPOS.MOOREH
Comstock, Neal, EX: /O*USTREASURY/OU*DO/CN*RECI PIENTS/CN*DOM3.DOPOS.COMSTOCKN
Wechsler, William, EX: /O-USTREASURY/CU+DO/CN+RECIPIENTS/CN*WECHSLERW
Klasky, Helaine, EX: /O-USTREASURY/OU*DO/CN=RECIPLENTS/CN#KlaskyH
Smith, Michelle A., EX:/O=USTREASURY/OU*DO/CN*RECI PIENTS/CN*SMITHM
patrick dorton@opd.eop.gov, SMTP:patrick_ dorton@opd.eop.gov
rsiewert@who.eop.gov, SMTP:rsiewert@who.ecop.gov

cc:

Subject: CA Energy Talks - Press Clips
Body:

Compromise Plan Is Urged in Energy Talks

The New York Times via Dew Jones

Publication Date; Sunday January 14, 2001
National Desk; Section 1; Page 30, Column 2
c. 2001 New York Times Company

By JOSEPH KAHN

WASHINGTON, Jan. 13 -- Clinton administration officials pressed politicians,
utilities and energy providers today to agree on a compromise plan to end the
electricity crisis that has left California, the nation's most populous and
richest state, on the brink of darkness.

With Gov. Gray Davia and California lawmakers participating by satellite
link, Treasury Secretary Lawrence H. Summers presided over an afternoon
negotiating session here that participants said aimed to keep the state's main
utilities financially solvent while arranging long-term supplies of power to


However, it is clearly Enron that blazed the trail for online energy trading and remains the king of this
market. As of the end of 2000, Enron had traded $336 billion worth of commodities on EnronOnline, led
by electricity and natural gas (Enron also trades other commodities such as bandwidth and paper). As of
late June, it has been reported that the notional value of all transactions on EnronOnline exceeded $650
billion, and the exchange's daily volume has soared to about 5,000 trades. Yet, while Enron may still be
the largest online energy exchange, TradeSpark’s recent growth is quite impressive, especially
considering that EnronOnline had a one-year jumpstart on all the other trading exchanges that
subsequently formed. TradeSpark maintains that it has transacted $30 billion worth of energy products
{notional value) since its October 2000 launch. Further, the dollar amount traded on the exchange has
grown steadily, from $12 billion in 4Q 2000 to $18 billion in 1Q 2001. Obviously, there is still a huge
gulf in notional transactions that separates EnronOnline from TradeSpark, but among the list of other
trading exchanges (such as Intercontinental Exchange, Dynegydirect and HoustonStreet) TradeSpark
appears to be the one that shows real potential of becoming a true competitor to EnronOnline.

In any comparison between the two exchanges, it is important to establish the key element that makes
TradeSpark unique from EnronOnline. TradeSpark is a multi-buyer / multi-seller trading exchange that
offers anonymous bidding to an open market of traders, EnronOnline, on the other hand, is a proprietary
trading exchange. In other words, in every transaction that takes place on EnronOnline, Enron
participates as either a buyer or a seller. TradeSpark says that about 54 percent of its average daily
transactions originate from activity between non-partners (companies that were not original founders of
the exchange). This statement indicates that liquidity is growing at a steady pace on the TradeSpark
exchange. While the majority of TradeSpark’s traders appear to be non-partner members, it is important
to note that the founding members mentioned above receive incentive payments in the form of warrants
if TradeSpark is successful. In other words, should TradeSpark hit $250 million in revenue by its fifth
year, eSpeed would make available 8 million warrants at a strike price of $27.94 to the founding
members of TradeSpark. Thus, the founding members are more inclined to participate on the exchange,
which in tum sparks interest from other participants and increases TradeSpark's liquidity

‘The neutrality issue is arguably the most important distinguishing feature between EnronOnline and
TradeSpark, and could be the one factor that is presently driving TradeSpark’s success. Many traders
who participate on various exchanges have expressed a preference for those marketplaces that offer
multiple buyers and sellers. As is the case with EnronOnline, when a trader knows that a particular
company is always a participant as a buyer or a seller in every transaction on their exchange, some
trading companies may be hesitant to reveal strategic information to the exchange-owning company. In
addition, regulatory pressures from the Federal Trade Commission may eventually make neutrality a
requirement, which is something that exchanges such as EnronOnline may have to address and
exchanges such as TradeSpark have already incorporated. When given a choice over various trading
exchanges on which to participate, my general impression is that traders would prefer to participate on
an exchange where issues of disclosing competitive information are not a concern.

T also think it significant that the bulk of TradeSpark’s trading volume is coming out of the natural-gas
business, While the exchange focuses on both natural gas and electricity instruments, in 2Q 2001,
TradeSpark's average natural-gas trading volumes increased from 100 million MMBTUs to a trading
high of 406 million MMBTUs on June 7, 2001. Further, TradeSpark has experienced a 90-percent
increase in the amount of natural-gas MMBTUs traded on the exchange, while the level of electricity
megawatt hours has increased by 17 percent. During the 1Q 2001 period, TradeSpark traded more than
2.18-billion MMBTUs of natural gas instruments (a notional value of about $11.6 billion) and 120-
million MWhs of electricity instruments (a notional value of about $6.4 billion)

Asa whole, the online trading market appears to be riding the wave of a major growth spurt. A study
conducted by AMR Research showed that 600 energy trading exchanges existed in April 2000. This


Missouri Commission Approves Empire, UtiliCorp Merger
JOPLIN, Mo.-- (BUSINESS WIRE)--Dec, 28, 2000-- The Empire District Electric Company
received an order today from the Missouri Public Service Commission approving the proposed
merger of Expire and UtiliCorp United Inc,

Electricity Generating close to acquiring stake in BLCP Co
Dec 28, 2000 - BANGKOK {AFX-ASIA) - Electricity Generating Plc is close to finalising a
deal with China Light Power to buy shares in BLCP Co, the operator of a coal-fired power
plant with a capacity of 1,400 megawatts under the independent power producer scheme, the
Bangkok Post quoted Egcomp president Sitthiporn Ratanopad as saying.

Aboitiz Equity acquires Northern Mini Hydro Corp for 395 mln pesos
Dec 28, 2000 ~ MANILA (AFX-ASIA) - Aboitiz Equity Ventures said it had acquired Northern
Mini Hydro Corporation for 395 min pesos.

Huaneng Power, Shandong Huaneng to merge Dec 31
Dec 2%, 2000 - SHANGHAI (AFX-ASIA) - Huaneng Power International Inc and Shandong Huaneng
Power Development Co Ltd will merge on Dec 31, the China Daily reported.

Rates

For more information about products on this topic visit our Information Marketplace

PG&E Tells Puc Bankruptcy Looms without Rate Hike / Utility Wants 26% More for
Supplying Electricity
Dec 30, 2000 - The San Francisco Chronicle Pacific Gas and Electric Co. officials defended
their request for a 26 percent rate hike today, telling an emergency meeting of state
regulators that the utility may go bankrupt without an immediate infusion of cash.

Califernia energy companies lobby for higher rates
SAM FRANCISCO, Dec 28 (AFP) - California's investor-owned utilities need a aurge in
electricity es to save them from bankruptcy brought on by poorly-handled deregulation,
the companies argued Thursday.

California Utility Officials Continue to Press for Higher Rates
By Jack Chang, Contra Costa Times, Walnut Creek, Calif. --Dec. 29--SAN FRANCISCO-~ Utility
officials continued pleas for massive rate hikes before a state commission Thursday and
outlined plans for even more increases in 2001 if wholesale energy costs don't drop scon.

Unitil /Concord Electric Company and Unitil/Exeter & Hampton Electric Company Fuel
and Purchased Power Rates te Increase January 1
Hampton, NH - December 29, 2000 Unitil/Concord Electric Company and Unitil/Exeter 6
Hampton Electric Company , subsidiaries of Unitil Corporation , today announced that the
New Hampshire Public Utilities Commission has approved incr to their Fuel and
Purchased Power Adjustment charges for effect on January 1, 2001.

Many Utilities Request Natural-Gas Rate Hikes; High Costs to Continue Through 2003
IssueAlert, Dec. 29 (Scientech) The first blast of winter temperatures has resulted in
some real-world impacts from the natural-gas shortage and related high prices on the
wholesale market. A growing number of electric utilities across the country have requested
fate increases in order to cover their expenses for obtaining the power, especially
natural gas, that they must provide to customers.

Special Offer from this Publisher!



Davis, Kitzhaber and Locke said in a written statement that the
Pederal Energy Requlatory Commission should impose immediate
wholesale price controls,

4 ie federal government must take up its responsibility to
prevent the chaos that threatens to engulf the entire western
electricity system,'' the governors said.

Sen. Dianne Feinstein, D-Calif., said she would propose
legislation to give the U.S. energy secretary authority to cap
skyrocketing wholesale electricity prices in 11 western states, It
would let the secretary impose a temporary wholesale price cap if
there is “‘unjust pricing’' and would remain in effect until prices
stabilized, said Howard Gantman, the

About 30 officials, including Davis, key members of the state
Legislature, the head of the state's Public Utilities Commission
and utility representatives, gathered at the Ronald Reagan Building
in downtown Los Angeles to confer with counterparts on the other
side of the country.

Linked from Washington were Sperling, Treasury Secretary
Lawrence Summers, James Hoecker of the Fede: Energy Regulatory
Commission, Deputy Energy Secretary T.J. Glauthier and officials
from power companies.

Feds, state and utilities meet to broker electricity deal
consumer advocate's quote. Pickup 6th graf pvs: “A state ....
Expected to atand for AMs

By LEON DROUIN KEITH*

LOS ANGELES (AP) State, federal and utility company officials
negotiated for seven hours Saturday on a plan that could make
California a long-term electricity broker in an attempt to resolve
the state's electricity crisis.

No decisions were reached during the live satellite hookup, but
further talks were scheduled.

President Clinton's top economic adviser, Gene Sperling, said he
believed there would be further talks in the next two days.

“"E don’t think any of us expect to get to the finish line
tonight,"' Sperling said. “°I think we can still make some more
progress.''

Gov, Gray Davis, who's been pushing to put the state into the
broker’s role, said California is “a credit-worthy purchaser. All
of us that met today are joined at the hip and if we are going to
move forward, we will move forward together.'*

Representatives from power providers Pacific Gas & Electric and
Southern California Edison refused comment after the meeting.

Douglas Heller of The Foundation for Taxpayer and Consumer
Rights, a consumer advocacy group, was wary about the plan.

““If the state becomes a public power agency buying electricity,
will the public benefit from that?'’ Heller asked. “Or is it a
mechanism for giving utilities their bailout?''

A state agency, under emergency powers from Washington, already
has spent roughly $30 million buying electricity in the past month
to stave off rolling blackouts during the California power crisis.
Officials want the state to expand and continue who. le
electricity buys, selling the power to utility companies, said
Steve Maviglio, a Davis spokesman.

The California Department of Water Resources made the earlier
emergency power purchases, including about 24,000 megawatt hours of
electricity on Thursday and Friday, Carl Torgersen, the
department's chief of utility operations, said Saturday. The
department acted under authority of emergency orders by U.S. Energy
Secretary Bill Richardson.

''(This) is something we've never done before,'' Torgersen said,
““We're in a new era with deregulation.'’

Wholesale power prices have increased fivefold in California
since last summer, accompanied by a series of drops in the state's



Peds, state and utilities meet to broker electricity deal
consumer advocate's quote. Pickup 6th graf pvs: ““A state ....
Expected to stand for AMs

By LEON DROUIN KEITH=

LOS ANGELES (AP) State, federal and utility company officials
negotiated for seven hours Saturday on a plan that could make
California a long-term electricity broker in an attempt to resolve
the state's electricity crisis.

No decisions were reached during the live satellite hookup, but
further talks were scheduled.

President Clinton's top economic adviser, Gene Sperling, said he
believed there would be further talks in the next two days.

“"E don't think any of us expect to get to the finish line
tonight,"' Sperling said. “"I think we can still make some more
progress.’'

Gov. Gray Davis, who's been pushing to put the state into the
broker's role, said California is “‘a credit-worthy purchaser. All
of us that met today are joined at the hip and if we are going to
move forward, we will move forward together.'*

Representatives from power providers Pacific Gas & Electric and
Southern California Edison refused comment after the meeting,

Douglas Heller of The Foundation for Taxpayer and Consumer
Rights, a consumer advocacy group, was wary about the plan.

““If the state becomes a public power agency buying electricity,
will the public benefit from that?'' Heller asked. “‘Or is it a
mechanism for giving utilities their bailour?''

A state agency, under emergency powers from Washington, already
has spent roughly $30 million buying electricity in the past month
to stave off rolling blackouts during the California power crisis.
Officials want the state to expand and continue wholesale
electricity buys, selling the power to utility companies, said
Steve Maviglio, a Davis spokesman.

The California Department of Water Resources made the earlier
emergency power purchases, including about 24,000 megawatt hours of
electricity on Thursday and Friday, Carl Torgersen, the
department's chief of utility operations, said Saturday, The
department acted under authority of emergency orders by U.S. Energy
Secretary Bill Richardson.

*'(This) 1s something we've never done before,'' Torgersen said.
“‘We're in a new era with deregulation.’

Wholesale power prices have increased fivefold in California
since last summer, accompanied by a series of drops in the state's
power reserves,

On Thursday, power reserves in California dipped below 2 percent
after a storm cut production at a key nuclear station.

The Independent System Operator, which manages moat of the
at. power grid, said electricity supplies had rebounded but
were still tight.

Davis and Govs. John Kitzhaber of Oregon and Gary Locke of
Washington said Friday that they would urge their residents to cut
electricity demand 7 to 10 percent, try to reduce power use by
their state governments by at least 10 percent, and look into
joining force to buy energy-efficient products for state and local
agencies to get through the crisis.

Davis and California's two largest investor-owned utilities have
pointed fingers at energy wholesalers, saying they have exacerbated
the crisis by taking advantage of the tight supplies for their own
profit.

Pacific Gas & Electric Co. and Southern California Edison, both
electricity retailers, say they have lost more than $9 billion
because of wholesale price increases and the state's 1996
deregulation law that froze rate hikes. The utilities, which won
permission te raise rates, said the temporary increases approved by
the state Public Utilities Commission weren't enough and have
warned they could go bankrupt if something isn't done,



Budington, Michele,

EX: /O*USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPOS. BUDINGTONM
Cetina, Jill,

EX: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM13.DOPO8.CETINAJ
Doml3.DOPO8.CHAVESM, GWISE:Doml3.DOFO®.CHAVESM
Eichenberger, Joe,

EX: /O*USTREASURY/OU=DO/CN*RECIPIENTS/CN=GROUPWISE/CN=DOM13.DOPOS .EICHENBERGERS
Pall, James, EX: /O=USTREASURY/OU=D0/CN=RECI PIENTS/CH=GROUPWISE/CN=DOM13.DOPOS. FALLI
Geithner, Timothy,

EX: /OUSTREASURY /OU*DO/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM1 3. DOPO8.GEITHNERT
Gelpern, Anna,

EX; /O-USTREASURY /OU=DO/CN+RECI PIENTS/CN+GRCUPWISE/CN=DOM13.DOPO8 .GELPERNA
John, James, EX: /O-USTREASURY/OU*DO/CN*RECI PIENTS/CN#GROUPWISE/CN*DOM13.DOPOG.JOHNJ
Lee, Nancy, EX: /O*USTREASURY/OU#DO/CN=RECI PIENTS/CN#GROUPWISE/CN=DOM13. DOPOS. LEEN
Lowery, Clay,

EX: /OsUSTREASURY /OU=DO/CNeRECI PIENTS/CNGRCUPWISE/CN@DOM13.DOPOS. LOWERYC
Ludden, Ken,

EX: /OmUSTREASURY/OU=DO/CNeRECI PIENTS/CNeGROUPWISE/CN@DOM13. DOPOS. LUDDENK
Schuerch, William,

EX: /O-USTREASURY /OU=DO/CN=RECI PIENTS /CN=GROUPWISE/CN=DOM1 3. DOPOS . SCHUERCHW
Stedman, Louellen,

EX: /OUSTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPOS . STEDMANL
Truman, Ted,

EX: /O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPOS. TRUMANT
Walsh, Helen,

EX: /OUSTREASURY/OU=DO/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM13.DOPOS .WALSHH
Alagiri, Priya,

EX: /O*USTREASURY/OU*DO/CN*RECI PIENTS/CN*GROUPWISE/CN*DOM3.DOPOS.ALAGIRIP
Andrews, Lisa,

EX: /OUSTREASURY /OU*DO/CN*RECI PIENTS/CN*GRCUPWISE/CN*DOM3 . DOPOS .ANDREWSL
Arnold, Thomas,

EX: /OPUSTREASURY /OU*DO/CN*RECI PIENTS/CN=GROUPWISE/CN=DOM3. DOPOS.ARNOLDT
Bordoff, Jason,

EX: /O=USTREASURY /OU=DO/CN*RECI PIENTS/CN#GROUPWISE/CN=DOM3. DOPOS . BORDOFPI
Cameron, Art,

EX: /O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3. DOPOS.CAMERONA,
Carter, Jana,

EX: /O@USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3 , DOPOS.CARTERJ
Cohen, Alan, EX:/O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM3. DOPOS, COHENA
Comstock, Neal,

EX: /O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3 , DOPOS. COMSTOCKN
Decker, Larry,

EX: /O@USTREASURY/OU=DO/CN#RECI PIENTS/CN@GROUPWISE/CN=DOM3. DOPOS. DECKERL
Desler, Anne,

Ex: /O-USTREASURY/OU+DO/CN+RECI PIENTS/CN+GROUPWISE/CN=DOM3. DOPOS. DESLERA
Egolf, Brian, EX: /O-USTREASURY/OU*DO/CN#RECI PIENTS/CN#GROUPWISE/CN=DOM3. DOPOS. EGOLFS
Eizenatat, Stuart,

EX: /O*USTREASURY/OU*DO/CN*RECI PIENTS/CN*GROUPWISE/CN*DOM3 , DOPOS. EIZENSTATS
Fant, William, EX:/O=USTREASURY/OU*DO/CN*RECIPIENTS/CN=GROUPWISE/CN#DOM3.DOPOS. FANTW
Planders, Stephanie,

EX: /OmUSTREASURY /OU=DO/CNeRECIPIENTS/CNeGROUPWISE/CN=DOM3 . DOPOS. FLANDERSS
Gathers, Shirley,

EX: /O=USTREASURY/OU=DO0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3, DOPOS. GATHERSS
Grayson, Cherry,

EX: /O=USTREASURY /OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3 . DOPOS . GRAYSONC
Harvey, Reavie,

EX: /O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GROUPWISE/CN=DOM3 . DOPOS. HARVEYR
Herold, Valerie,

EX: /O*USTREASURY /OU*DO/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM3. DOPOS . HEROLDV
Johnson, Linda,

EX: /O*USTREASURY /OU*DO/CN*RECI PIENTS/CN*GROUPWISE/CN*DOM3. DOPOS. JOHNSONL
Joseph, Verlene,

EX: /O*USTREASURY /OU*DO/CN*RECIPIENTS/CN#GRCUPW1SE/CN=DOM3. DOPOS . JOSEPHV
Keene, Carolyn,

EX: /O*USTREASURY/OU=DO0/CN#RECI PIENTS/CN=GROUPWISE/CN=DOM3 . DOPOS. KEENEC
Keller, Alan,


generating company chief executives looked at Davis with a "What are you
amoking?" expression several times Tuesday night. The generators" stance is that
the market price is 8.5 cents/kwh and only if the contracts run for eight years,

But that's all just negotiating position. The customers of Edison
International's {EIX} Southern California Edison currently pay the company 7.6
cents/kwh just for energy. That price includes last week's one-cent raise, but
not other charges such as transmission and distribution.

Edison generates half the power it needs at a cost of about 3 cents/kwh. So,
purchasing the other half at 5.5 cents/kwh would do a lot more than stop the
hemorrhaging. If the cost of purchased power were 5.5 cents, Edison's average
cost would be 4.3 cents, for which they are getting paid 7.6 cents. That 3.3
cents/kwh profit on the 83 billion kwh Edison sells a year comes to a whopping
$2.7 billion annually. End of credit problem.

PG&E Corp.'s (PCG) situation is more difficult. Their customers pay less for
electricity, and PG&E only generates a third of its own power, but they have
lower generating costs than Edison. Bottom line: if PG&E could buy supplies at
5.5 cents/kwh, they would be left with 1.9 cents/kwh profit.

Unfortunately for the utilities, California independent generators, such as
Reliant Energy (REI), NRG Energy (NRG), Dynegy (DYN), Southern Energy (SOE) and
Duke Energy (DUK), can't get their prices down to 5.5 cents/kwh in California
given the current market price of natural gas.

But they don’t need anything close to 8.5 cents for eight years. The forward
price for wholesale power in California for the balance of this year is 16
cents/kwh for the on-peak hours, which is what the utilities mostly need to buy.
The on-peak price drops to 11 cents/kwh for a three-year contract because new
generators and new gas supplies are expected to come on line. For an eight-year
contract, the price drops to about 7.3 cents/kwh.

At 7.3 cents, PG&E would be heading to bankruptcy court. But the generators
will get to sell PG&E some off-peak power, too, which brings the average price
down a little further. If the governor guarantees really quick licensing for a
couple of new power plants in northern California, the price comes down a lot.

What's more, to save deregulation in the U.5. the generators are willing to
cut to the bone. The stocks of Dynegy, Enron Corp. (ENE), etc., have high
price-to-earnings ratios because their earnings are expected to continue strong
growth under electric deregulation. They are the emerging masters of a
deregulated universe, but if deregulation were to throw PG&E and Edison into
bankruptcy court, there wouldn't be any deregulated electric universe to master.

As one electricity trader put it: "They have got to get a deal done. If they
don't get ‘The California Energy Crisis’ off of CNBC every 30 minutes, I'm going
to be out of a job."

Generators' stock prices have been getting hammered since the first of the
year due to eral factors, such as profit-taking after a great 2000, according
te Credit Su. First Boston utility analyst Paul Patterson. Duke's stock has
fallen to $66 from $85 since Dec. 29, for example.

Prices of generator stocks have come down hard, in part, because a California
catastrophe would derail deregulation in many states and the forecasts for
generators' earnings growth would be questioned, according to Solomon Smith
Barney analyst Ray Niles.

That's the finances. The physical reality is that the western U.3. probably
won't have enough electricity to meet demand for the rest of this year. Starting
in February, if a deal ia done, California utilities won't he the last in line
to get their power, and the threat of blackouts will be spread out across the
West.


From: ‘Squitien, Ray

Sent: Thursday, February 21, 2002 12:08 AM
To: SearchCameo
Subject: CAMEO Recon found a word: Enron sent by SCIENTECH IssueAlen to on 7/11/2001

8:50:23 AM

Issusdlert
7_11_01.hemnd
This message was found to have a Critical Word in it. Message Sent to , From
SCIENTECH IssueAlert, CC to , Date 7/11/2001 8:50:23 AM, Subject of message TradeSpark
Emerges as Leader in Online Trading, Edges In On EnronOnline

Word(s) found: Enron

From: SCIENTECH IssueAlert
Sent: 7/11/2001 8:50:23 AN

Received: 7/11/2001 2:43:47 EM

To:

cc:

Subject: TradeSpark Emerges as Leader in Online Trading, Edges In On EnronOnline
Body:

swcece End of message body

Message auditing by MicroData CAMEO Recon


Project in Oregon. 628 DSOB. 2 p.m. Contact: 202-224-4971.

ENVIRONMENT AND PUBLIC WORKS

Clean Air/Energy

Clean Air, Wetlands, Frivate Property, and Nuclear Safety
Subcommittee hearing on harmonizing the Clean Air Act with the
nation’s energy policy. 406 DSOB. 9 a.m. Contact: 202-224-6176.

FOREIGN RELATIONS

Green Nomination

Full committee hearing on the nomination of Grant Green Jr. of
Virginia to be undersecretary of State for management. 419 DSOB.
2 p.m. Contact: 202-224-4651.

JUDICIARY

Aviation Competition

Antitrust, Business Rights and Competition Subcommittee hearing
to examine aviation competition and issues involving
concentration at high-density airports, 226 DSOB. 10 a.m.
Contact: 202-224-5225. (Revised.}

INTELLIGENCE

Intelligence

Full committee hearing on intelligence matters. 219 HSOB. 3 p.m.
Contact: 202-224-1700. (Closed.)

=HOUSE COMMITTEES=

AGRICULTURE

Rice Industry

Full committee hearing to review federal farm commodity programa
with the rice industry. 1300 LHOB. 10 « Contact: 202-225-2171.
(Revised.)

APPROPRIATIONS

CFTC Oversight

Agriculture Subcommittee oversight hearing on the Commodity
apn Trading Commission, 2362-5 RHOB. 9:30 a.m. Contact: 202-
225-2771.

JUDICIARY

Commerce, Justice, State and Judiciary Subcommittee hearing on
the Administrative Office of the U.S. Courts; judicial offices.
H-309 Capitol. 10 a.m, Contact: 202-228-2771.

Defense Readiness

Defense Subcommittee hearing on military readiness, H-140
Capitol. 9:30 a.m. Contact: 202-225-2771. [Revised/Closed.)
Hurricane Funds

Foreign Operations, Export Financing and Related Programs
Subcommittee hearing on implementation of the Hurricane Mitch
supplemental appropriation, involving the GAO and the inspector
general of the Agency for International Development. H-144,
Capitol, 10 a.m. Contact: 202-225-2771.

FY02 Appropriations

Interior Subcommittee oversight hearing on the Office of Special
Trustee for American Indians, trust reform, 6-308 RHOB. 10 a.m,
Contact: 202-225-2771, (Revised. }

FYO2 Appropriations

Labor, HHS Subcommittee hearing on FY02 appropriations under its
jurisdiction. 2358 RHOB. 10 a.m, Contact: 202-225-2771.

FY02 Appropriations

Military Construction Subcommittee hearing on FY02 appropriations
for Family Housing Privatization. B300 RHOB. 9:30 a.m, Contact:
202-225-2771.

Transportation Appropriations

Transportation Subcommittee hearing on FYO2 appropriations for



General

For more information about products on this topic visit our Information Marketplace

Boosting Public Power
Dec 28, 2000 - Bond Buyer Public power weathered the deregulation and legislative squalls
of 2000 fairly well and faces what appears to be a relatively bright and stable future in
2001, according to market participants and analysts.

Joint Ventures & Alliances

For more information about products on this topic visit our Information Marketplace
Topic Sponsor: LineSoft

LineSoft Corp. - Specializing in Engineering Line Design 6 Optimization - Visit us at
DistribuTECH, Booth #710, Feb, 5 - 7 in San Diego!

Deals/Contracts

For more information about products on this topic visit our Information Marketplace

Gas Natural wins contract to supply electricity to Madrid military hospital
Dec 29, 2000 - MADRID (AFX) - Gas Natural SDG SA said its La Energia unit has won a
contract to supply electricity to the Gomez Ulla military hospital in Madrid.

Power Pricing/Supply

For more information about products on this topic visit our Information Marketplace

Silicon Valley preps for energy crisis
SAN FRANCISCO, Dec 28 (AFP) - High-tech companies in California's Silicon Valley are
scrambling for backup power sources as the state's energy crisis continues.

Transmission & Reliability

For more information about products on this topic visit our Information Marketplace

PECO Energy Goes to Full Emergency Alert for New Year's Weekend Snowstorm
PHILADELPHIA, Dec. 29 /PRNewswire/ With a potential major Noc'Easter storm approaching the
region, PECO Energy Company said it has moved into an Alert status for its customer
service, operations and support personnel to prepare for emergency response.

OG6E Reports Progress in Restoring Electric Service After Ice Storm
OKLAHOMA CITY, Dec. 30 /PRNewswire/ OG6E Electric Services today reported progress in
restoring electric service to thousands of its customers left without power after the ice
storm of Dec. 25-26.

Arkansas Utility Companies Battle Cold, Bad Weather
Arkansas Democrat-Gazette --Dec, 29--SPRINGDALE, Ark. Utility companies made slow progress
restoring power to Northwest Arkansas customers Thursday as ice continued to topple trees


HIAA Official Selected As Health Staff Director

Dean Rosen, a senior vice president and general counsel of the
Health Insurance Association of America, has been named staff
director of the Senate Health, Education, Labor and Pensions
Public Health Subcommittee.

Senate Public Health Subcommittee Chairman Bill Frist, R-
Tenn., named Medicare, prescription drugs and patient
protections, along with inadequate insurance coverage, as issues
Rosen would help deal with.

Before working at HIAA, Rosen was majority counsel for
healthcare is: for the House W. and Means Committee. Rosen

Anne Phelps, who now works for the White House.

POLITICS
Bush Nominates Two Trade Deputies

President Bush Tuesday announced his intention to nominate
Peter Allgeier and Linnet Deily for the posts of deputy United

States trade representative with ambassador authority.

Allgeier currently works in the Bush White House, serving as
senior director for international affairs at the National
Economic Council. Before joining the NEC, he had served in the
Office of the U.S. Trade Representative since 1981, working in
the Western Hemisphere and the Western European and the
Mediterranean divisions.

Deily is presently vice chairman in the office of the
president of the Charles Schwab Corp.

FLOOR SCHEDULE

*SENATE®
Convenes at $:30 a.m. to resume consideration of campaign finance
reform legislation. Votes are possible throughout the day.

House
Convenes at 10 a.m. to consider five bills under suspension of
the rules,

TODAY
=SENATE COMMITTEES=

APPROPRIATIONS

NATO Issues

Defense Subcommittee hearing on FY02 appropriations fer NATO
Issues. Witness: General Joseph Ralston, Supreme Allied Commander
Europe. 192 DSOB. 10 a.m. Contact: 202-224-3471. (Revised.)

ARMED SERVICES

Defense Budget

Readiness and Management Support Subcommittee hearings on
proposed legislation authorizing funds for FY02. 232-A RSOB. 9:30
a.m, Contact: 202-224-3871.

COMMERCE

Rail Transportation

Surface Transportation and Merchant Marine Subcommittee oversight
hearing on the Surface Transportation Board, 253 RSOB, 9:30 a.m.
Contact: 202-224-5115.

ENERGY AND NATURAL RESOURCES

Energy Overview

Full committee oversight hearing to review energy trends and
fecent changes in energy markets. 106 DSOB. 9:30 a.m. Contact:
202-224-4971. (Revised.)

Klamath Project

Water and Power Subcommittee oversight hearing on the Klamath


From: ‘Squitien, Ray

Sent: Thursday, February 21, 2002 12:25 AM
To: SearchCameo
Subject: CAMEO Recon found a word: Enron sent by Squitieri, Ray to jwang@cera.com on 7/11/2001

3:14:09 PM

Issusdlert
7_11_01.hemnd
This message was found to have a Critical Word in it. Message Sent to
jwang@cera.com, From Squitieri, Ray, CC te , Date 7/11/2001 3:14:09 PM, Subject of message
Fa: TradeSpark Emerges as Leader in Online Trading, Edges In On EnronOnline

Word(s) found: Enron

pamaneen ‘Original Nessage-----

From: Squitieri, Ray

Sent: 7/11/2001 3:14:09 PN

Received: 7/11/2001 3:14:09 EM

To: jwang@cera,com, SMTP: jwang@cera.com

ce:

Subject: Fu: TradeSpark Emerges as Leader in Online Trading, Edges In On EnronOnline
Body:

may be of interest. Woof!

~----Original Message-----

From: SCIENTECH IssueAlert [mailto:IssueAlert@scientech. com]

Sent: Wednesday, July 11, 2001 8:50 AN

Subject: TradeSpark Emerges as Leader in Online Trading, Edges In On
EnronOnline

ouccce End of message body

Message auditing by MicreData CAMEO Recon


and because PG&E and Edison owe installments on their debts Tuesday.

California deregulated its energy market beginning in 1998. It was a leap
into the unknown that was nevertheless expected to lead to lower prices for
consumers, It has done anything but that since last May, when electricity
prices--prodded upward by rising natural gas prices and by supply
shortages--went through the roof.

PG&E and Edison together spent more than $11 billion more for electricity in
2000 than they received from consumers, who remained insulated by the remnants
of state regulation.

The state nearly had to resort to statewide rolling blackouts Thursday when
power reserves dipped below 1.5% of total usage.

The utilities--and their customers--were rescued at the last minute by the
state Department of Water Resources, which bought power that the state energy
marketplace couldn't buy because its credit, backed by utilities, is so poor.

One participant in the negotiations, natural gas executive Kenneth Lay, has
been a friend, donor and advisor to incoming president George W. Bush.

Lay, chairman of the Houston-based natural gas pipeline company Enron Corp.,
who attended the meeting in Los Angeles, was part of a large group of outside
advisors involved in shaping Bush's rgy policy, campaign aides say. Now Lay
is serving on an energy policy advisory committee that Bush assembled for the
transition.

Power crisis talks to move back to California

By Patrick Connole

WASHINGTON, Jan 14 (Reuters) - California Gov. Gray Davis
will lead last-ditch talks in his state starting on Sunday to
save the Golden State's two largest utilities from bankruptcy
and ensure long-term power supplies to the nation's most
populous state,

After a seven-hour bi-coastal video conference on Saturday
~~ led in Washington D.C. by Treasury Secretary Lawrence
Summers and by Davis in Sacramento, Calif, -- California
officials are now in charge of settling the power crisis over
the long Martin Luther King, Jr. holiday weekend.

“The governor laid out a framework for him and the
legislative leadership to work on," said White House National
Economic Council Director Gene Sperling, speaking to reporters
after the marathon session with state officials and industry
executives.

“The issue is now for them to work out the proposal.”

Energy Department officials said the talks would convene in
Sacramento, and possibly other locations, in California on
Sunday and continue through the weekend.

A federal offer to reconvene a high level meeting of the 25
“principles” on Tuesday was made, according to Sperling, who
said "we stand ready and available” if needed.

Soaring wholesale power prices and an inability to pass
those costs on to consumers have drained more than $12 billion
from PG&E Corp. <PCG.N> and Edison International <EIX.N>,
pushing them to the edge of bankruptcy.

With supplies of electricity already stretched to the
limit, a severe winter storm earlier this week sent the state
close to rolling blackouts. The crisis was averted by a
last-minute injection of hydropower from the federally-owned
Bonneville Power Administration in the Pacific Northwest.

Industry experts view Tuesday as a crucial deadline for
settling a deal since it marks the first day financial markets
open after the long weekend. Bond rating services and stock
market traders are expected to hammer PG&E and Edison if a deal



Democrats responded Tuesday evening that Nussle's numbers do
not add up, the GOP budget does nothing te extend the solvency of
the Social Security and Medicare trust funds, and it is being
marked up prematurely,

Speaking on the eve of his first markup as chairman, Nussle
told reporters Tuesday that the FY02 budget resolution he will
offer this morning would divide the $5.6 trillion total budget
surplus that CBO projects over the next 10 years as follows:

Set aside the entire $2.49 trillion in Social Security trust
fund surpluses, allocating $2 trillion over 10 years to paying
down the publicly held debt and reserving the $491 billion
remainder for Social Security reform.

Provide $1.62 trillion for tax cuts. Any increase in the on-
budget surplus that CBO projects in its midsession review would
be reserved for further tax cuts or debt reduction, although
Nussle does not expect the so-called “bump-upTM to be significant.

Use $462 billion for debt service.

Save $503 billion in a general contingency reserve to defray
the cost of as-yet unspecified needs, such as additional spending
called for in Defense Secretary Rumsfeld's strategic review or
increased assistance to farmers.

Set aside the entire $393 billion Medicare Part A trust fund
surplus for Medicare reform and creation of a prescription-drug
benefit. The amount requested in Bush's budget, $153 billion,
would specifically be dedicated to pay for Bush's prescription-
drug plan and the remainder placed in a separate reserve fund for
further modernization legislation.

Commit $121 billion to fund other domestic spending
initiatives.

For FY02, the budget allocates $661 billion in discretionary
budget authority. Of that, $324.3 billion is for defense
spending.

Nussle said money from the contingency fund could be tapped
only via a presidential request and reports from the committees
of jurisdiction outlining why the funds were needed and how they
would be spent,

Democrats criticized the swiftness of the markup--before
Congress has either the more detailed budget Bush will send to
Capitol Hill next month or detailed revenue estimates out of the
Joint Committee on Taxation.

“Frankly, this budget is on too fast a track,” Budget
Committee ranking member John Spratt, D-S.C., told reporters,
even as he praised Nussle's cooperation with Democrats.

“Their budget," Spratt added, “is fixated on tax
reductions...and leaves no room for other priorities.”

Rep. James Moran, D-Va., a senior Budget Committee Democrat,
added to the Democrats’ criticiam.

“We want tax cuts as much as Republicans--but tax cuts that
are affordable, that are not going to have to be paid for by our
children,” Moran said,

Moran plans to offer an amendment calling for a legislative
trigger to link the phase-in of tax cuts to future budget
surpluses,

To illustrate Democratic budget priorities, Spratt and his
colleagues have filed 18 amendments they may offer today, in
addition to a Democratic alternative based on their proposal to
divide the surplus into thirds.

Among their other amendments are provisions to take the
Medicare Part A trust fund off budget and require that Social
Security and Medicare surpluses be used exclusively to pay
benefits.

Democratic amendments also would reduce the size of the tax
cut to create a voluntary, universal Medicare prescription-drug
benefit; set up a reserve fund of $9 billion in FY02 and $4
billion a year after that to provide supplemental income
assistance to farmers; and create a reserve fund to increase



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OSCIENTECH
IssueAlert.

July 11, 2001

TradeSpark Emerges as Leader in Online Trading,



Environmentalists complain that the increased secrecy over costs of
generating and trading power makes it difficult to evaluate TVA's decisions
and operations.

“I think it is a very dangerous trend,” said Stephen Smith, executive
director of the Southern Alliance for Clean Energy, a Knoxville-based
consumer and environmental group. "We don't necessarily want TVA to be at a
competitive disadvantage, but whether or not a plant is running is
certainly

information that the public has a right to know about,”

Dr. Smith said his group's assessment about the costs of operating TVA's
oldest coal plants compared to generating power from cleaner sources is
being

undermined by TVA's refusal to disclose its costs of operations.

"This lends itself very easily to abuse,” he said.

But supporters of deregulation insist the market discipline of competition
will help ensure utilities are well run and meet consumer demands. Public
power enthusiasts also note that government agencies are subject to state
and

federal open records requirements, unlike investor-owned utilities.

“We're regulated by our customers who own us and are our neighbors,” said
Alan Richards, president of the American Public Power Association. “I think
more information about power activities is better than less and, in
general,

public power is much more open than are our investor-owned counterparts."
But private utilities disagree.

“There's always been a problem of disclosure by TVA because they are not
subject to the same oversight that the investor-owned utilities are through
FERC and state public service boards,” said John Howes, executive director
of

TVA Exchange, a lobbying group that monitors TVA for other Southern
utilities, "As the market becomes more regional and national, TVA needa to
somate under the same rules of disclosure that its neighboring utilities

+ TVA is a federal agency and enjoys the exceptions and benefits of a
government agency, why don't they behave like a public identity?" Mr.
Knauff

asked.

soonce End of message body

Message auditing by MicroData CAMEO Recon


to the Florida Department of Environmental Protection, then to the Florida governor and cabinet for
final approvals. As Southern Company has contracted for this plant on the city level, it apparently is
absolved from the various state restrictions that have obstructed the plans of Enron and Duke to build
new facilities

One remaining question about Enron's proposed Deerfield Beach plant concerns the often-tenuous
regulation that surrounds peaking units. Although Enron has claimed that the proposed plant will only
operate in times of peak usage in Florida, it is unclear exactly how this would be regulated (and by
whom). Typically, peaker units are restricted to only operating for a specified number of hours in a year
or monitored so that their emissions are limited to a certain level. However, oftentimes plants that are
classified as peaker units end up operating beyond the time for which they were originally scheduled.
Thus, if Enron's peaker unit in Deerfield Beach ultimately gains all of the necessary environmental
permits, it will be interesting to see how the plant is regulated in a state that has shown resistance toward
the expansion of out-of-state generators

Ironically, public resistance to new power plants in Florida comes at a time when new reports suggest
that the state faces an imminent power supply problem. According to representatives from Florida's
Energy 2020 Study Commission, Florida's electric reserve is significantly less than the 16-percent
reserve that incumbent utilities have claimed exists. In fact, the commission has found that, “without
extraordinary management techniques including power disruption,” Florida's reserve is 7 percent. It is
important to note that the commission is not including interruptible loads in its reserve calculations. If
interruptible load is considered, then Florida most likely does have a roughly 16-percent electric reserve.

Nevertheless, leaders in Florida remain very concemed about any inherent characteristics in the state
that might lead to a California scenario. Specifically, the chairman of the 2020 commission stated that
Florida has an “over-reliance on interruptible supply contracts with industrial and commercial
customers, a high reliance on power from other states and significant restrictions on the development of
new power plants.” It is the third factor that is perhaps most concerning in Florida, as presently it is only
incumbent utilities that can develop new power supply with comparatively few regulatory restrictions.

Once again, Enron seems to be in the middle of a controversial debate as it pushes the competitive
boundaries in a state that is slowly making accommodations for a deregulated market. The mixed bag of
public opposition, attempts by incumbent utilities to hold onto their market base, and state legal
restrictions may create a bumpy road for Enron (or other out-of-state companies) that attempt to
penetrate the Florida market. For now, however, Enron appears to be one step closer to adding Flonda to
its large market base.

An archive list of previous IssueAlerts is available at
www. scientech.com

)
The most comprehensive, up-to-date map of the North American Power System by RDUV/FT
Energy is now available from SCTIENTECH

Reach thousands of utility analysts and decision makers every day. Your company can schedule a
sponsorship of IssueAlert by contacting Nancy Spring via e-mail or calling (505)244-7613
Advertising opportunities are also available on our website



number grew to 1,500 by September 2001. A separate report conducted by Forrester Research indicates
that online trading in wholesale markets increased 750 percent from 1999 to 2000. The same report
projects that online trading volume will continue to grow, leaping from $400-billion market in 2000 toa
$3.6-trillion market in 2005.

Of course, not all of these exchanges are expected to be successful. In fact, the vast majority of them
will probably shut down or be forced to merge with another partner to ensure survival. As consolidation
continues within the online trading space, most projections suggest that two primary kinds of exchanges
will remain active. One of these exchanges is likely to be a liquidity hub that attempts to attract
members that want to exchange price risk in pure commodities, which is represented by EnronOnline,
Dynegydirect, ete. The other exchange that will survive will probably be a merchant platform that
attempts to bring multiple market players together, which is represented by TradeSpark, HoustonStreet,
Intercontinental Exchange, and others.

The primary challenge for all online trading exchanges is to establish liquidity, What traders appear to
want and what makes an exchange successful is liquidity, meaning essentially the amount of
transactions on the exchange and, consequently, the opportunity to access beneficial deals. TradeSpark’s
model has been unique due to the rush-to-market capability that the alliance with eSpeed supported, and
also the incentive program among its founding members, which apparently has played a role in
increasing participation on the exchange. The remaining half of this year should be fertile ground for
TradeSpark to exhibit continued growth. However, as consolidation continues to remain an undercurrent
in the online trading market, it is still rather premature to project which exchanges will remain in
operation once the dust settles.

An archive list of previous IssueAlerts is available at
www. scientech.com

i}
The most comprehensive, up-to-date map of the North American Power System by RDI/FT
Energy is now available from SCLENTECH

Reach thousands of utility analysts and decision makers every day. Your company can schedule a
sponsorship of IssueAlert by contacting Nancy Spring via e-mail or calling (505) 244-7613
Advertising opportunities are also available on our Website.

SCLENTECH is pleased to provide you with your free, daily IssueAlert. Let us know if we can
help you with in-depth analyses or any other SCTENTECH information products. If you would
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SCIENTECH's IssueAlerts®TM are compiled based on the independent analysis of SCIENTECH
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financial performance of companies discussed, or to be the basis for investment decisions of any



sponsorship of IssueAlert by contacting Nancy Spring via e-mail or calling (505) 244-7613.
Advertising opportunities are also available on our Website.

SCIENTECH is pleased to provide you with your free, daily IssueA/ert, Let us know if we can
help you with in-depth analyses or any other SCLENTECH information products. If you would
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SCIENTECH's IssueAlertsTMTM are compiled based on the independent analysis of SCIENTECH
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financial performance of companies discussed, or to be the basis for investment decisions of any
kind. SCIENTECH's sole purpose in publishing its IssneAlerts is to offer an independent
perspective regarding the key events occurring in the energy industry, based on its long-standing
reputation as an expert an energy issues.

Copyright 2001, SCIENTECH, Ine, All rights reserved.



Keller, Alan,
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Levine, Marne,
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Mejia, Annabella,
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Summers, Larry,
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Wolin, Neal, EX:/O*USTREASURY/OU*DO/CN*RECI PIENTS/CN*GROUPWISE/CN*DOM3.DOPO6.WOLINN
ex.mail.JONESM, GWISE:ex.mail.JONESM
ex.mail.VJORSTAD, GWISE:ex.mail.VJORSTAD
Adashek, Jonathan, EX: /O-USTREASURY/CU*DO/CN*RECIPIENTS/CN*ADASHERT
Affleck-Smith, Joan, EX: /O-USTREASURY/OU=DO/CN*RECIPIENTS/CN*AFFLECK-SMITH
Baer, Gregory, EX: /O=USTREASURY/OUeDC/CN=RECIPIENTS/CN=BAERS


SCIENCE

Nuclear Safety

Energy Subcommittee hearing on H.R.723, Civil Penalties for
Nuclear Safety Violations by Nonprofit Energy Department
Contractors Under the Atommic Energy Act of 1954. 2318 RHOB. 1
pm. Contact: 202-225-6371,

SMALL BUSINESS

Office of Advocacy

Pull committee hearing to explore ways to improve the Office of
Advocacy and to make that office a more effective voice for small
busines: within the federal government and the private sector.
2360 RHOB. 10 a.m. Contact: 202-225-5821.

Veterans’ Affairs Committee and Senate Veterans’ Affairs
Legislative Priorities

Joint full committee hearing to receive the legislative
priorities of the American Veterans of WWII, Korea and Vietnam,
American Ex-Prisoners of War, Vietnam Veterans of America, the
Retired Officers Assn., National Assn. of State Directors of
Veterans Affairs, 345 CHOB. 10 a.m. Contact: 202-225-3527.

On the Hill Thursday

Environment

House Nuclear Cleanup Caucus. Briefing on cleanup efforts at
Hanford, Wash, 121 CHOB, 8:45 a.m, Contact: 202-225-5816

FOREIGN AFFAIRS

Bipartisan news conference on suffering and slavery in Sudan.
Participants: House Majority Leader Armey and Rep. Donald Payne,
D-N.J. House Triangle, Capitol. 1:30 p.m. Contact: Terry Holt,
202-225-6007. (New.)

SOCIAL ISSUES

Senate Indian Affairs Committee, First 107th Congress briefing on
the genesis and foundation of Indian affairs policy, including
Indian self-determination. TBA. 10 a.m. Contact: 202-224-2251.

TAXES

American Conservative Union news conference on the estate tax.
Participants: Rep. Jennifer Dunn, R-Wash.; David Keene, ACU;
Karen Kerrigan, Small Business Survival Committee; Kerri Houston,
American Conservative Network and others. House Triangle. 11:30
a.m, Contact: Kerrie Houston, 972-446-6854, (New.)

POLITICS

National Republican Congressional Campaign pen and pad
redistricting political briefing. Participant: Rep. Thomas Davis,
R-Va. NRCC, Conference Room, 2nd Floor, 320 First St., SE. 11
a.m. Contact: Carl Forti, 202-479-7070.

PRIDAY
TMSENATE COMMITTEES=
None.

=HOUSE COMMITTEES=

ARMED SERVICES

Depot Repairs

Military Readiness Subcommittee hearing on current and future
viability of depot maintenance repair, focusing on the Pre-Shop
Analysis Building, Corpus Christi Army Depot, Corpus Christi, TX.
2118 RHOB. 9 a.m. Contact: 202-225-4151.

MONDAY
SENATE COMMITTEES=
None.


From: ‘Squitien, Ray

Sent: Thursday, February 21, 2002 12:07 AM

To: SearchCameo

Subject: CAMEO Recon found a word: Enron sent by SCIENTECH IssueAlen to on 6/22/2001
8:54:37 AM

Issuedlert

6_22_01.hemt
This message was found to have a Critical Word in it. Message Sent to , From
SCIENTECH IssueAlert, CC to , Date 6/22/2001 8:54:37 AM, Subject of message Enron
Embroiled in Power Plant Wars in Florida

Word(s) found: Enron

aeelenl ‘Original Message-----

From: SCIENTECH IssueAlert

Sent: 6/22/2001 8:54:37 AN

Received: 6/22/2001 2:48:44 EM

To:

cc:

Subject: Enron Embroiled in Power Plant Wars in Florida
Body:

swcece End of message body

Message auditing by MicroData CAMEO Recon


“HOUSE COMMITTEES=
None.

CongressDailyAM is published daily, Monday through Friday, by
National Journal Inc., when Congress is in session. Copyright
2001 by National Journal Inc., 1501 M St., NW, #300, Washington,
D.C. 20005. Retransmission, redistribution or reproduction of
CongressDaily is prohibited without the express, written
permission of National Journal Inc.

President--John Fox Sullivan, 202-739-8468 (jsullivan@njdc.com)
Publisher~-Steve Hull, 202-739-8475 (shull@njde.com)
Editor--Louis Peck, 202-735-8481 (Ipeck@njde.com)

Subscription price: $2,497 a year. Subscription and e-mail
transmission information: 202-739-8542 (cngdaily@njdc.com).

oo

-——2
CDENDITL

s ratatahated End of message body

Message auditing by MicroData CAMEO Recon


RECENT TOP STORIES
These stories have been most requested by Energy Central members in the last two
weeks.

1, Is Gas/Electric Tolling an Answer to the Forward-Contract Impasse? (12/26/00)

2. Deregulation Blamed for Calif. Blackout Electricity Supply Chain Was Broken Inte Many
Parts (12/25/00)

3. Compromise nearing in California electricity crisis (12/25/00)

4. Activists Blast Davis' Energy Plans / Rate Increases Should Not Be Used to Bail Out
Utilities, Consumer Groups Say (12/25/00)

5. California Utilities Receive Rate Hike, Threat of Bankruptcy Still Looms (12/26/00)

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opponents of the Jordan deal are “misreading the politics” of
global trade.

“Why can't the Bush administration accept this freebie from
the previous administration unle: it is trapped in an
ideological box?" he asked. “We are begging for a fight we do not
even have to have."

He suggested approving the Jordan agreement quickly and asked,
“What harm is there in putting it to the test?" Grassley
responded that Kerry “had a point" about using Jordan as a
“laboratory,” but he cautioned about seeing it as the standard
for trade policy. -- By Stephen Norton

TRANSPORTATION
Dorgan Bill Seeks Two-Year Moratorium On Airline Mergers

Citing aggressive consolidation in the airline industry, Sen.
Byron Dorgan, D-N.D., Tuesday introduced legislation calling for
@ two-year moratorium on all major airline mergers announced
after Jan. 1, 2001.

Dorgan conceded that he is not likely to find “an avalanche of
support" for the legislation from either congressional
Republicans or President Bush, "I don‘t think this president is
going to take on antitrust issues, merger issues," Dorgan said.
He added, “This administration is pretty close to corporate
America.”

Dorgan acknowledged his bill would effectively nullify
American Airlines’ pending acquisition of TWA. Critica have
argued that merger would accelerate movement toward control of
the aviation industry by airline giants United, American and
Delta.

Dorgan said he could have included an exemption for the TWA-
American deal in his bill, but he decided that “good public
policy” dictated otherwise.

Dorgan's proposal comes in the wake of the Senate Commerce
Committee's narrow approval last week of legislation designed to
foster more competition among airlines. However, it had been
atripped of a proposal intended to slow major airline mergers.

Dorgan said several committee Democrats privately admitted
after the hearing to having serious concerns about airline
industry consolidation. Nevertheless, “I'm not unmindful of the
fact that some key people [will] object te anything” that might
keep the TWA-American transaction from being completed, he said.

The Commerce Committee, of which Dorgan is a member, also last
week approved by voice vote a bill designed to strengthen the
government's hand in disciplining airlines that mistreat
passengers.

Senate Majority Leader Lott told CongressDaily Tuesday that he
might try to bring that passengers’ rights legislation to the
floor next week, or whenever the chamber concludes debate on
campaign finance reform legislation.

Dorgan hinted that he might seek to attach a version of his
airline-merger moratorium legislation to that bill. “Service and
pricing will not improve until there is real competition,” Dorgan
said Pamela Barnett

COLUMN: OUTSIDE INFLUENCES
Money For Nothing?

Money changes everything, or so the adage goes. But as the
Senate debates iegisiation to drastically curb the amount of
money in politics, it is worth asking: Does it really? An Outside
Influences review of the top campaign contributors in the 1999-
2000 election cycle finds that many of the most generous
corporations actually scored few legislative victories.

The regional Bell operating companies, for example, shoveled
more than $5 million in unlimited "soft money” contributions to


heads Tennessee Power Co., an independent power producer in Chattanooga.
“The

exchange of data is necessary to have a fluid and effective market, but TVA
doesn't want anyone to know what they are doing so no one can criticize
them.

If TVA is going to operate just like a private business, maybe it should
just

be one."

OLD DEBATE FOR NEW DEAL AGENCY

The dispute over how much freedom TVA should have in its power operations
is

old as the New Deal agency itself. When President Franklin Roosevelt
established TVA in 1933, he envisioned "a corporation clothed with the
power

of government but possessed of the flexibility and initiative of a private
enterprise.”

Unlike most utilities, TVA is free to set its own rates and conduct its own
business without approval or oversight by any state regulatory board. TVA
is

also exempt from direct oversight by the Federal Energy Regulatory
Commission

and isn't covered by many antitrust laws.

But until recently, TVA was still beholden to the U.S. Congress for money
to

pay for its nonpower programs. As a government agency, TVA also regularly
disclosed its plans for buying, generating and transmitting power around
its

seven-state service territory.

Congress cut off TVA funding three years ago, however. At the same time,
the

growing competition and deregulation in the electricity industry encouraged
TVA to keep quiet about many of its operations.

TVA now limits access for even its own staff to the trading room adjacent
to

the power load center where TVA buys and sells power each day.

“There is a problem when we are out purchasing power if other people know
that our plants aren't operating or they know what we are planning to buy
that day," Mr. Zeringue said. “If they know one of our big assets is down,
then the price that is available to us for buying power will probably be
just

under what it would cost if we fired up our gas turbines (TVA's most
expensive power generation). We get taken to the cleaners on it. That's why
we are a little hush-hush.”

Mr. Zeringue said TVA is keeping most information about the current status
of

its power operations to itself, although he said information about plant
operations could be disclosed later. Many of the inquiries about TVA's
power

status come from competitors interested in gaining a price advantage, not
from consumers trying to ensure TVA keeps its costs down.

“We occasionally get calls from strange places wanting to know this, that
and

the other, We just don't respond to the calls," Mr. Zeringue said.

Even years after power trading deals are completed, TVA is sometimes
unwilling to disclose any of their terms. Earlier this year, for instance,

a

power marketing arm of Enron Corp, settled one of TVA's biggest lawsuits
for

an undisclosed amount, TVA sued Enron after it failed to provide enough

power
during the summera of 1993 and 1999.

But the terms of the multimillion-dollar settlement prevented TVA or Enron
from disclosing any of the details of their trading arrangements or
monetary

settlement.

WHO'S WATCHING THE STORE?


Barr, Michael, EX: /O=USTREASURY/OU#DO/CNeRECIPIENTS/CN=BAREM

Bell, Rochelle, £X:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=BELLR
Beresik, Michael, EX:/O-USTREASURY/OU=D0/CN=RECIPIENTS/CN=BERESIKM
Bresee, Elisabeth, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=BRESEEE
DeMarco, Edward, 2 /OSUSTREASURY/OU=D0/CN=RECIPIENTS/CN=DEMARCOE
Foote, Norman, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=FOOTEN
Gensler, Gary, EX:/Q=USTREASURY/OU=DO/CN=RECIPIENTS/CN=GENSLERG
Johnson, James, £X: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=JOHNSONJE
Lebryk, David, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=LEBRYKD
Ross, Lisa, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN*ROSSL

cc:

Subject: Linda Robertson's info.

Body:

Linda L. Robertson

Vice President, Federal Government Affairs
Enron

1775 fye Street, N.W., Suite 600
Washington, D.C. 20006

(202) 466-9159 (direct)

(202) 828-3372 (FAX)

e-mail address: linda. rcbertson@enron.com

Message auditing by MicroData CAMEO Recon


This week, Silicon Valley manufacturers warned Davis that the state had better
get its energy supply in order, or they would look to move their operations. The
head of Intel Corp. declared that the unreliability of power in California means
that the company would build its new manufacturing facilities out of state.

“This energy crisis is probably the most critical issue Silicon Valley has
faced in last the 30 years," said Carl Guardino, president of the Silicon Valley
Manufacturers Group, a powerful association composed of 190 of the largest
companies in the high-tech corridor.

Most sides agree that the central problem in California is that it only
partially deregulated its energy markets in 1996. The st lowed power
generators te operate freely, charging whatever the wholesale market will bear
for their electrons, but it kept in place retail price caps for the utility
companies that buy the power and deliver it to homes and businesses.

This has pushed two of the state's largest utilities -- Southern California
Edison and Pacific Gas & Electric -- to the brink of bankruptcy.

The two utilities say they have accumulated some $12 billion in uncompensated
costs because of the high prices they are paying for wholesale electricity from
the power generators. Wall Street has threatened to slash their credit ratings,
making it harder for them to borrow the money they need to buy power. The
utilities are seeking rate increases to ease their debt, but the governor and
California energy officials are loath to see ratepayers hit with bills that
could double or triple.

If the state resorts to rolling blackouts, it risks undermining a still-strong
economy.

"There is a ripple effect that could be a tidal wave in California,” Guardino
said.

If a computer chip manufacturing plant suddenly loses power, Guardino said,
the assembly lines grind to a halt, the product is potentially lost, the line
must be retooled, a process that can take days. Orders are not met; stock prices
can tumble.

Energy is so vital to the many giant tech companies headquartered in Silicon
Valley that even a one-day power outage, such as the one that occurred last
June, can cost as much as $100 million,

If the state bails out its two biggest utility companies, or lets them keep
raising rates for electricity, it risks the wrath of consumers who already
believe their energy costs are too high and who, according to polls, are still
questioning the severity of the crisis. In San Diego last summer, consumer rates
rose 300 percent when they were left to the whims of the open market.

As California's crisis deepens, s' across the West are nervously watching.
The Pacific Northwest, in particular, is apprehensive because consumers and
industries there are already facing higher energy costs because of California's
needs, Electricity consumers in Oregon and Washington have already been pressed
to reduce their power use by 10 percent.

On Friday, the governors of Oregon, Washington and California met in
Sacramento te provide a united front and to reaffirm that they are all in this
mess together.

Traditionally, California utilities ship power north to Oregon and Washington
in the winter and take the power back during the summer to run California's air
conditioners.

But not this year.

Washington Gov. Gary Locke (D) said that light snow and rain have dropped
water levels in the Pacific Northwest, raising concerns that the region's


End Up Costing Consumers $40 Billion

Dec 31, 2000 - The San Francisco Chronicle Next month, about 10 million Californians may
begin paying as much as 30 percent more for electricity, in a maddening coda to one of the
most costly public policy mistakes ever made.

End Run Around PGSE Envisioned / Commission Wants Plan on S.F. Ballot
Dec 30, 2000 - The San Francisco Chronicle San Francisco voters may get a chance next year
to form 4 municipal utilities district -- a crucial step toward creating a public power
system in the city.

California Utility Outrages Customers with Request for 40-Percent Rate Hike
By Carrie Peyton, The Sacramento Bee, Calif. --Dec. 29--SAN FRANCISCO With national focus
on California's electricity crisis growing, Pacific Gas and Electric Co. began notifying
customers that it wants to boost their electric bills up to 40 percent by the end of 2001.

Calif Power Rate Hearings End
Dec 28, 2000 - LOS ANGELES, Dec. 28 (UPI) -- Hearings aimed at giving consumer advocates
and utility officials the chance to air their views on a looming electricity rate increase
concluded late Thursday, setting the stage for a decision by requlators that very well may
not please anyone.

Nuclear Power May Endure in the U.S. Power Business
Dec 27, 2000 - Bloomberg Two decades after the near-disaster at Three Mile Island soured
Americans on nuclear energy, the industry is showing signs of a comeback, partly because
of the soaring cost of other fuels.

Competition & Deregulation

For more information about products on this topic visit our Information Marketplace

Topic Sponsor: Energy Central Deregulation Legislation Database

The Deregulation Legislation Database, one of the industry's most comprehensive and
current compilations, is available now in the Data Center. Sign up for your free trial for
access to this database and related reports. Click here:

http://www. energycentral.com/sections/datacenter/datacenter_home.cfm

Open Forum; Another Utility Bailout Should Leave US Cold
Dec 31, 2000 - The San Francisco Chronicle OUR CURRENT energy problems are urgent and
serious. But before the governor and the Public Utilities Commission cut yet another deal
costing consumers billions of dollars, perhaps they should pause to ask the public what
kind of system it wants and what it will end upwith after investing billions more.

California at Energy Impasse
Dec 30, 2000 - Tulsa World Gov. Gray Davis failed to broker a compromise Thursday between
utility executives and consumer advocates who are livid over looming increases in
electricity bills for 10 million Californians.

Mergers, Acquisitions & Divestitures

For more information about products on this topic visit our Information Marketplace

AES buys 61.7 pet of Gener for G41 mln usd after Chilean offer closes
Dec 28, 2000 - SANTIAGO (APX) - AES Corp has acquired 61.7 pet of Gener SA for 841.2 min
usd after its offer, launched in Chile on Nov 3, closed yesterday, the Santiago bourse
said.


Other than that, where's the rub? Under derequlation, consumers were supposed
to get market rates in 2002. Based on the current forward market and the
utilities’ cost of retained generators, 7 cents/kwh for the rest of this year is
a great deal. For 2002, it's fair, but for 2003-2008, it's terrible, The current
purchase price for those years is about 5 cents. With utility-owned generation
at 3 vee consumers will be paying 7 cents/kwh when they should be paying 4
cents/kwh,.

And the 2.4 cents/kwh competition transition charge (CTC) that was supposed to
end in 2002 has to be extended several more years. The CTC is “"non-bypassable,”
which means if you leave the local monopoly for an alternative supplier, you
still have te send a couple of cents/kwh to the old utility.

Ratepayer groups got about 40 people to storm the PG&E corporate headquarters
this week over the one cent rate increase. Another rate increase would cause
riots and ballot initiatives, and cost Davis his job.

But can consumer groups get people out in the streets over a deal that's great
now, but overcharges them starting in 2003? I doubt it.

Businesses such as Intel Corp, (INTC) will know they are getting the short end
of the stick financially and that power in the western U.S. is still unreliable,
so they will decide to build new factories in other stat That's how you
bypass non-bypassable charges. It will be bad for the st economic growth,
but California needs to stop adding electricity demand.

The stare are aligned for a deal very soon: eight days left before the
executive branch of the U.3. government changes from one that wants to help
Davis to one that wants to hurt him; about the same amount of time is left
before the utilities run out of cash; forward power prices have come down a lot
in the past 30 days, but could easily start to rise again; merchant power
company stock prices have been punished for two weeks, and their executives
don't want to kill the golden goose.

How can they not get this done?
-By Mark Golden, Dow Jones Newswires; 201-938-4604; mark.golden@dowjones.com

(END) Dow Jones Newswires 12-01-01

1800GMT
{AP=DJ-01-12-01 1800GMT)
TICKER: CPN DUK DYN EIX ENE INTC NRG PCG REI 30 SOE
?SUBJECT: EUTL SEMI DI1 DI4 DI2 CA GA MN NC TX COMM
Copyright {c) 2001 Dow Jones and Company, Inc.
Received by NewsEDGE/LAN: 1/12/01 12:55 2M
<=> End of message body

Message auditing by MicroData CAMEO Recon


Edges In On EnronOnline

By Will McNamara
Director, Electric Industry Analysis

[News stem front Renters] Online energy marketplace TradeSpark said on July 10 that it
traded products with a notional value of $41.9 billion in the second quarter of this year,
up from $18 billion in the first quarter. The rise in the second quarter brought the total
transaction value since TradeSpark’s October 2000 launch to $71 billion. According to
TradeSpark, during the second quarter the system was used to trade over 6.8 billion
MMBTUs of natural gas instruments, with a notional value of over $33 billion, a rise of
189 percent over the first quarter. It was also used to trade about 155-million megawatt
hours of electricity instruments, with a notional value of some $8 2 billion, a rise of 29

M@ percent over the first quarter

Analysis: As we have now reached the mid-year point, it is a good time to take a step back and assess
how the online energy trading market is being repositioned EnronOnline, which launched in August
1999, certainly has been the market leader since that time, but TradeSpark (on the basis of its strong
performance and one key distinguishing feature that sets it apart from Enron) has emerged as a
formidable player this year. In fact, 2001 could very well become the year that TradeSpark inches ever
closer to EnronOnline, closing the gap in what has become a highly saturated market. The online trading
space is prone to rapid consolidation and many players that emerged over the last year have found it a
daunting challenge to establish liquidity. However, other players (and TradeSpark is part of this group)
have taken full advantage of market volatility, the high cost of natural gas that was common earlier this
year, and the ongoing advances in Internet technology to forge ahead with a promising new business
model

For background, TradeSpark was formed in September 2000 by trading systems developer eSpeed, Inc
(Nasdaq: ESPD), brokerage Cantor Fitzgerald and several energy companies, including Dominion
Resources (NYSE: D), TXU Corp. (NYSE: TXU), Williams Cos, (NYSE: WMB), Koch Energy
Trading, and Royal Dutch / Shell unit Coral Energy. eSpeed has an equity stake in the TradeSpark
partnership. Through this equity stake, eSpeed is able to share in all potential upside value of
TradeSpark, based on an initial investment in the exchange of $2 million cash, representing a 5-percent
equity stake in the exchange. TradeSpark is creating one large liquidity pool by bringing together several
mediums, including the Intemet, voice brokering and eSpeed’s 300 millisecond private global network

The affiliation with eSpeed was particularly important as TradeSpark did not have to construct a trading
infrastructure, as it adopted the one that had already been put into place by eSpeed. This allowed
TradeSpark to enter the market earlier than many of its subsequent competitors and gain an important
first-strike advantage. The exchange offers trader services such as real-time prices for commodities,
maturities, delivery points, and other benchmarks of the market. eSpeed, an independent trading
company that spun off from Cantor Fitzgerald in 1999, provides the technology infrastructure that
supports the TradeSpark exchange, along with supporting other multiple buyer / multiple seller
electronic marketplaces. eSpeed is an end-to-end electronic trading system that can accommodate up to
150 transactions per second, per instrument, with an as-mentioned 300-millisecond execution time. The
customizable system displays all prices on the system anonymously to all market participants. Note that
even before the partnership with TradeSpark, eSpeed had received investments of $25 million each from
Dynegy and Williams to develop at least four new commodity-specific electronic spot and futures
trading marketplaces.


Federal Energy Regulatory Commission should impose immediate
wholesale price controls.

‘*The federal government must take up its responsibility to
prevent the chaos that threatens to engulf the entire western
electricity system,'' the governors said,

Sen, Dianne Feinstein, D-Calif., said she would propose
legislation to give the U.S. energy secretary authority to cap
skyrocketing wholesale electricity prices in 11 western states. It
would let the secretary impose a temporary wholesale price cap if
there is “‘unjust pricing’’ and would remain in effect until prices
stabilized, said Howard Gantman, the senator's spokesman.

About 30 officials, including Davis, key 6 of the state
Legislature, the head of the state's Public Utilities Commission
and utility representatives, gathered at the Ronald Reagan Building
in downtown Los Angeles to confer with counterparts on the other
side of the country.

Linked from Washington were Sperling, Treasury Secretary
Lawrence Summers, James Hoecker of the Federal Energy Regulatory
Commission, Deputy Energy Secretary T.J. Glauthier and officials
from power companies.

s ratatahated End of message body
Message auditing by MicroData CAMEO Recon


From; ‘Squitien, Ray
Sent: Thursday, February 21, 2002 12:10 AM
To: SearchCameo

CAMEO Recon found a word: Enron sent by James_Mietusomb.eop.gov to
paula.farreli@do. treas, gov; kevin.kelly@ferc.fed.us; dan.larcamp@ferc.doe.gov treas, gov;
fay squitierigdo.treas.gov; Alexander_M._Brill@cea.eop.gov; Wallace_P.
_Mullin@cea.eop.gov; arthur,

This message was found to have a Critical Word in it. Message Sent to

paula. farrell@do,treas.gov; kevin, kelly@ferc. fed.us; dan. larcamp@ferc.doe.gov. treas.gov;
ray.squitieri@do.treas.gov; Alexander M. Brill@cea.eop.gov; Wallace_P. Mullin@cea.eop.gov;
arthur. rypinski@dow.hq.gov.treas.gov, From James Mietusfomb.eop.gov, CC to , Date
7/16/2001 11:57:46 AM, Subject of message FYI on TVA: Critics attack TVA secrecy

Word(s) found: Enron

From: James_Mietus@omb.eop.gov
Sent: 7/16/2001 11:57:48 AM
Received: 7/16/2001 11:57:21 AM
To: paula.farrell@do.treas.gov, SHTP: paula. farrellédo.treas.gov
kevin. kelly@ferc.fed.us, SMTP: kevin. kelly@ferc.fed.us
dan. larcamp@ferc.doe,gov.treas.gov, SMTP:dan,larcamp@ferc.doe.gov.treas,gov
ray squitieri@do.treas.gov, SHTP:ray.squitieri@do.treas.gov
Alexander _M. Brill@cea.eop.gov, SMIP:Alexander M, Brillécea.eop.gov
Wallace _Mullin@cea.eop. gov, SMTP:Wallace_P. Muliin@cea.eop.gov
arthur. Fypinski@dow. hq-gov.treas.gov, SMTP thur. rypinski@dow. hq. gov. treas.gov

cc:

Subject: FYI om TVA: Critics attack TVA secrecy

Body:

Here's a news article from this morning's Chattanooga paper, in which an
independent power producer alleges TVA is being inappropriately secretive
with respect to price, cost and production information.

Chattanooga Times Free Press - Monday, July 16, 2001

Critics attack TVA's secrecy

By Dave Flessner

Business Editor

Tennessee Valley Authority's power load center in the bowels of its
downtown

Chattanooga complex is designed to be secure against bombs, missiles and
terrorists.

But the secrecy of the power center is now under attack.

The federal utility no longer discloses current information about power
loads, business operations or even if one of its nuclear plants has shut
down, For the firat time, TVA officials aren't telling what they expect the
peak power demand to be this year in the Tennessee Valley.

TVA officials say such information could sometimes push up the cost of
power

the agency buys or lower the amount it receives for electricity it
generates

and sells to other utilities.

“We're on a trading floor now and if the market knows that one of our units
is down, power markets can more easily raise the price of what they sell to
us," TVA President 0,3, "Ike" Zeringue said, "That's a never a good
situation.”

But critics claim the government utility is often shielded from public
scrutiny and is blocking information needed for a competitive market to
operate freely.

“Under the guise of ‘potential business competition,’ TVA is withholding a
lot of information,” said Michael Knauff, a former TVA power trader who now



Bell, Rochelle, EX: /O=USTREASURY/OU=DO/CN#RECIPIENTS/CN=BELLR
Beresik, Michael, EX: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=BERESIKM
Bresee, Elisabeth, EX: /O=USTREASURY/OU=DO/CN=RECI PIENTS/CN=BRESEEE
DeMarco, Edward, EX: /O=USTREASURY/OU=DO/CN=RECI PLENTS/CN=DEMARCOE
Foote, Norman, EX:/O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=FOOTEN
Gensler, Gary, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=GENSLERG
Johnson, James, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=JOHNSONJE
Lebryk, David, EX:/O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=LEBRYKD
Ross, Lisa, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=ROSSL

cc:

Subject: Linda Robertson's info.

Body:

Linda L, Robertson

Vice President, Federal Government Affaira
Enron

1775 Eye Street, N.W., Suite 600
Washington, D.C. 20006

(202) 466-9159 (direct)

(202) 828-3372 (FAX)

e-mail address: linda. robertson@enron.com

en End of message body

Message auditing by MicroData CAMEO Recon


Knowledgeable sources descrihed Treasury Secretary Lawrence Summers as taking
an active role in attempting to forge an agreement during Tuesday's talks, which
also featured Energy Secretary Sill Richardson, White House economic adviser
Gene Sperling and Federal Energy Regulatory Commission Chairman James Hoecker.

Richardson, who is traveling this weekend in an effort to lobby oil-producing
nations against a pending production cut, will not be attending Saturday's
session,

The working group meetings will wrap up sometime Friday, the Treasury
Department said.

The two groups have separately addressed the two primary features of the
proposed settlement, which involve moving the state's financially ailing
utilities out of volatile spot power markets and into fixed-price forward
contracts while power producers agree to "forbearance" on the huge debt owed by
the utilities

The forbearance and contracts working groups have been meeting separately, and
were to convene a joint session late Friday to compare notes before reporting
back to the principal negotiators who will cut any final deal.

Those familiar with the talks have expressed a mix of pessimism and optimism
that a final deal can be struck, given what they described unrealistic
bargaining demands by Gov. Davis.

He has firmly rejected retail rate increases and resisted demands for the
state to guarantee the nearly $12 billion utilities have paid over the last
eight months for wholesale power but been unable to pass along under
state-mandated frozen retail rates.

Further complicating the talks have been demands by Davis that the proposed
long-term power contracts be at rates far below the production costs of
electricity generators.

But lately the pessimism has been tempered by signals that Davis may be
persuaded to relent Saturday in his opposition to a state-backed securitization
of the utilities’ undercollections.

“Let's see their plan, and then we'll talk about that," Steve Maviglio, the
governor's spokesman, said late Thursday.

Davis reportedly has been under increasing pressure from Wall Street and
Clinton administration officials to reconsider his opposition to securitization.

Without a state credit guarantee, a work-out plan can't be struck, the
utilities will enter bankruptcy and the state's power grid will collapse into
blackouts, sources familiar with the talks warn.

The affected utilities are Southern California Edison Co., a unit of Edison
International (EIX), and Pacific Gas & Electric Co., a unit of PGSE Corp. (PCG).

By Bryan Lee, Dow Jones Newswires, 202-862-6647, bryan. lee@dowjones.com

(END) Dow Jones Newswires 12-01-01
2100GMT

{AP-DJ~-01-12-01 2100GMT)

?TICKER: EIX PCG SRE

SUBJECT: EUTL STGO DI7 DI1 DI4 DI2 CA COBO COMM
Copyright (c) 2001 Dow Jones and Company, Inc.
Received by NewsEDGE/LAN: 1/12/01 3:55 PM


Under one possible compromise, the state would arrange long-term contracts to
buy electricity on the wholesale market at fixed prices far below today's spot
price. The state would then pass that power on to utilities to distribute to
consumers.

Both utilities and power generators consider that idea workable, participants
said. Utilities would be assured of recouping their costs under the plan, while
generators would agree to sell power in coming years at prices well above those
that prevailed a year ago, though far below panic prices today.

One outstanding issue is the length of those purchase contracts. Power
generators have pushed for the contracts to last up to 13 years. The state would
prefer that they extend for only a few years.

Negotiators have also considered a plan that would allow the utilities
themselves to enter long-term contracts, participants said. Power generators
would have te agree to allow the utilities to suspend debt payments for a grace
period while they repair their finances.

California's Energy Future Looks Dim; Problems Brought on by
Deregulation Plan Defy Easy Solutions
The Washington Post via Dow Jones

Publication Date: Sunday January 14, 2001

A Section; Page Al

Copyright 2001, The Washington Post Co. All Rights Reserved
By Rene Sanchez and William Booth

Washington Post Staff Writers

LOS ANGELES, Jan. 13 -- After months of warnings, threats and hand-wringing
about power shortages in the country's richest and most populous state,
Californians this week finally came face to face with darkness.

As a huge winter storm sent demand for electricity outstripping supply along
the West Coast, operators of the state's power grid declared a Stage Three
emergency Thursday, which meant that electricity reserves had fallen so low that
the first mandatory statewide blackouts since World War II were imminent. The
crisis worsened when the San Diablo nuclear plant idled its twin reactors for
fear that kelp tossed by high waves could block the plant's water-cooling intake

pipes.

The state narrowly averted turning off the lights for millions late Thursday
== at rush hour, during a severe storm -- after Gov. Gray Davis (D) got on the
telephone to beg for electricity from power providers in the Pacific Northwest
and Canada. The storm was just the latest blow to California's two largest
electric utilities, which have been pushed close to bankruptcy by their
inability to pass on much higher wholesale power prices.

The system-wide meltdown brought about by a poorly executed deregulation plan
defies easy solutions. The problems are so dire that in Washington today, Gene
Sperling, director of the National Economic Council, along with Treasury
Secretary Lawrence H. Summers and other administration economic officials, held
emergency talks via teleconference with Davis, California energy authorities and
company officials.

During the seven-hour conference, a new proposal by Davis was considered in
which the state would purchase power, preferably at favorable terms, to sell to
the utilities. Davis hopes to announce the plan by Tuesday morning, Sperling
said, “I'm hopeful we'll have a deal as scon as humanly possible," added James
J. Hoecker, chairman of the Federal Energy Regulatory Commission (FERC).

With each new dire warning of power blackouts or utility bankruptcies, the
consequences of California's energy quagmire, for the state, the West and even
the nation, are becoming more obvious and extreme.


225-2171.

APPROPRIATIONS

Medical Programs

Defense Subcommittee hearing on medical programs. H-140 Capitol.
9:30 a.m. Contact: 202-225-2771,

FY02 Appropriations

Labor, HHS Subcommittee hearing on FY02 appropriations. 2358
RHOB, 10 a.m. Contact: 202-225-2771.

Transportation Appropriations

Transportation Subcommittee hearing on FY02 appropriations for
the Federal Highway Administration.2356 RHCB. 10 a.m. Contact:
202-225-2771.

FYO2 Appropriations/VA-HUD

VA-HUD-Independent Scommittee hearing on FY02 appropriations
under its jurisdiction. H-143, Capitol. 9 a.m. Contact: 202-225-
2771.

ARMED SERVICES

Research Companies

Military Research and Development Subcommittee hearing on
innovative research companies, 2118 RHOB. 10:30 a.m. Contact:
202-225-4151, recorded schedule 202-225-2675.

Energy and Commerce

California, Part IL

Energy and Air Quality Subcommittee h
Markets: California.” 2322 RHOB. 10
Medical Privacy

Health Subcommittee hearing on "Assessing HIPAA: How Federal
Medical Record Privacy Regulations Can Be Improved." 2123 RHOB.
10 a.m. Contact: 202-225-2927.

ring on “Electricity
Contact: 202-225-2927,

GOVERNMENT REFORM

Telecommuting

Technology and Procurement Policy Subcommittee oversight hearing
to examine federal government agencies’ efforts to create and
promote telecommuting programs. Witnesses: Steve Cohen, acting
director, Office of Personnel Management; David Bibb, acting
deputy director, GSA; Mark Lindsey, acting administrator, Federal
Railroad Administration: Tony Young, director of government
activities, NISH; Braden allenby, vice president for environment,
health and safety, AT6T; Jennifer Alcott, director,
Fredericksburg Regional Telework Center. 2154 RHOB. 2 p.m.
Contact: 202-228-5074,

JUDICIARY

Intellectual Property

Courts, the Internet and Intellectual Property Subcommittee
oversight hearing on "ICANN, NEW gTLDS and the Protection of
Intellectual Property." 2141 RHOB. 10 a.m. Contact: 202-225-3951.

RESOURCES

Oil and Gas Oversight

Energy and Mineral Resources Subcommittee oversight hearing on
oil and gas sources on federal submerged lands. 1334 LHOB. 2
pm. Contact: 202-225-2761.

Land Designations

National Parks, Recreation, and Public Lands Subcommittee markup
on H,R.107, to require an Interior Department study to identify
sites and resources, to recommend alternatives for commemorating
and interpreting the Cold War; H.R.146, to authorize the Interior
secretary to study the suitability and feasibility of designating
the Great Falls Historic District in Paterson, NY, as a unit of
the national park system.1324 LHOB. 10 a.m. Contact: 202-225-
2761.



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Correction to 6/21/01 IssueAlert—Due to a typographical error, yesterday's column
incorrectly stated that JEA (formerly known as Jacksonville Electric Authority) has 35,000
customers in a four-county area in northeast Florida. The number should have been 350,000
customers. In fact, as of June JEA's Website indicates that it now has more than 600,000
customers in northeast Florida. We apologize for this typographical error

a

IssueAlert.

June 22, 2001

Enron Embroiled in Power Plant Wars in Florida



proposal that would force you into a recession,” he said.

Gramm said his proposal would set a point in time--perhaps
three years into the tax cut--when the expedited procedures would
ftect.

A spokesman said Gramm had talked to about 30 colleagues about
the idea and noted that Majority Leader Lott had spoken favorably
of it. Miller acknowledged that work is being done on the
proposal but declined to comment further.

“I think people feel some urgency,” said Gramm. "We have to
deal with the budget.”

Gramm's proposal comes as GOP leaders are trying to assemble
the votes to pass a budget resolution, which is scheduled to come
straight to the floor after debate concludes on campaign finance
reform next week.

“We're hopeful to get 51 votes," said Senate GOP Conference
Chairman Rick Santorum of Pennsylvania. "We knew it was going to
be very difficult.”

Santorum said leaders were holding discussions to line up
support for the budget. "We just want to hear their concerns” and
“find out what issues trouble them,” Santorum said.

Gramm Tuesday dismissed an idea by Minority Leader Daschle
that the Senate consider a proposal to lower only the lowest
income-tax rate.

“Why would you want to do one bracket instead of the rate cut
for everybody?” he asked.

Lett left open the option for the Senate to take up the House~
passed tax-rate bill before it acts on President Bush's entire
tax cut, if a unanimous consent agreement can be reached.

But Sen. John Breaux, D-La., said Tuesday that it would be
impossible te reach such an agreement on any element of the Bush
plan.

In the House, after huddling with GOP leaders Tuesday, House
Ways and Means Chairman Thomas said he hoped to finalize late
Tuesday the content of the next package of tax cuts to move
through his committee.

Thomas said he was reviewing data and trying to determine
which pieces would go into the next package, but insisted he
would not make an announcement before today, saying, "Once it's
done, it's dene."

Pending completion of the next tax cut package, Thomas added
that it was possible he could move up his committee's scheduled
Friday markup te Thursday.

At the White House, President Bush--charged by Democrats with
abetting the economy's decline by stressing weakness while
promoting his tax cut--sought instead Tuesday to emphasize the
economy's pion ype

Bush ted that "the health of our economy is going to be
very aceon” in the long term. "People have got to know that I
have got great faith in the American economy,” he told reporters.

Bush, who has repeatedly indicated the economy is
“sputtering,” voiced a milder tone.

“We've got some problems, some short-term problems, and if
Congress were to act quickly on my tax stimulus package, it would
make our recovery quicker,” he said.

Meanwhile, a private sector group allied with Bush began
running radic advertisements Tuesday in South Dakota. The ads
are designed to prod Sen. Tim Johnson, D-S.D., to back Bush's tax
cut proposal.

The Issues Management Center, which has said it plans to spend
$5 million on advertising and other activities, recently began
aiming its pro-tax cut campaign at Democratic ators up for re~
election next year in states that voted for Bush.

The advertisements feature commentary by former presidential
candidate Steve Forbes and sound clips from a speech by former
President Kennedy, promoting his own tax cut nearly 40 years ago.

The IMC, run by GOP operatives Scott Reed, Bill Dal Col and



address critical shortages.

Participants said teams of negotiators had worked out compromise proposals to
relieve the energy crisis by lier today, potentially allowing the governor
and power companies to reach a final agreement soon. But some participants in
the talks warned that negotiations could continue through the weekend.

"'I don't think any of us expect to get to the finish line tonight,'' Gene
Sperling, director of the National Economic Council, told reporters gathered at
the Energy Department for the talks.

“'I expect us to have continued work over the weekend and over the holiday,‘’
Mr. Sperling said.

The goal of the talks was to smash through the logjam that has paralyzed
California's power industry after partial deregulation in 1996. Amid severe
shortages, the PGSE Corporation and Edison International, the state's major
utiliti: are paying far more to buy power than they are allowed to charge
consumers to use it. They face $12 billion in debt and possible bankruptcy.

The situation became critical last week when a storm reduced power production
and increased demand to the extent that officials warned that it might be
necessary to shut off power to parts of the state. Any intentional blackouts
would have been the first in California since military officials ordered
lights-out te deny Japanese bombers easy nighttime targets during World War II.

Because of the electricity shortage and the financial troubles of utilities,
out-of-state companies that sell power to California are charging exorbitant
prices on the spot market for immediate delivery, Utilities say they cannot
afford to buy power at those prices because under the deregulation law they
cannot pass the increased costs on to consumers.

The state has accused power producers of price gouging. The producers say
that California's problems are home-grown and that the prices reflect widespread
shortages and fears that the state's utilities could collapse without paying
their debts.

Bringing the negotiations to a successful conclusion is tricky, participants
said, Mr. Davis will inevitably be faced with delicate political choices, On the
one hand, he must work to lift the threat of power outag Qn the other,
California residents and busines. will ultimately bear burden of any
solution, perhaps by paying twice as much for electricity as they do now.

Consumers groups are fighting any agreement that would result in
substantially higher electricity prices. They argue that the out-of-state
producers have already pocketed a windfall from the state's power crisis and
that residents should not pay more to help them profit more.

Clinton administration officials said the federal government had no direct
role in the matter. But the financial health of multibillion-dollar utilities
and the threat of power shortages in the nation's technology center have raised
concerns that California's problems could rattle the national economy, which
already shows signs of slowing.

Mr. Summers, Me. Sperling and other senior officials involved are helping to
broker a compromise and to put pressure on both the power producers and the
politicians to reach a settlement, administration officials said.

Mr. Davis, along with the governors of neighboring Oregon and Washington,
have argued that the federal government should impose a price cap on wholesale
power to rein in the volatile spot market.

Energy Secretary Bill Richardson said he favored a price cap. But that option
was rejected by the Federal Energy Regulatory Commission, an agency that
regulates electricity sales between states.


the construction of unregulated merchant plants in the state. Zoning rules and community resistance
have at times made this market penetration very difficult for Enron, and its reputation has arguably taken
@ beating in the state. As it stands presently, Enron has received approval from Deerfield Beach, Fla., to
build a $10-MW plant, single-cycle unit (as opposed to combined-cycle) that can only operate for 3,500
hours a year. This approval followed previous plans to build a similar plant in Pompano Beach, Fla.,
which Enron abandoned amidst fierce community opposition. (Note that a county moratorium on new
plant construction, which Enron plans to contest, may thwart the Deerfield Beach project.) I've included
this business as a challenge for Enron because, once again, the company seems to be in the middle of a
controversial debate as it pushes the competitive boundaries in a state that is slowly making
accommodations for a deregulated market. The mixed bag of public opposition, attempts by incumbent
utilities to hold onto their market base, and state legal restrictions may create a bumpy road for Enron
{or other out-of-state companies) that attempt to penetrate the Florida market. For now, however, Enron
appears to be one step closer to adding Florida to its large market base.

Moreover, regarding its stock price, as noted Enron shares hit a peak value of $90.56 in August 2000
However, in the first six months of 2000, the company's stock has dropped considerably. Since the close
of the second quarter, the stock has been hovering near $49. As of early moming trading on July 16,
Enron shares were priced at about $48.78. The losses in its broadband unit must be particularly painful
for Enron as the company continues to position itself as more than just an energy-focused investment
bank. In the midst of ongoing criticism that its shares are overpriced, Enron continues to shape itself into
an Internet-based, multi-commodity-focused firm. However, Enron is not like most other companies that
have plunged into the telecommunications and water arenas only to take a damaging hit. Never forget
that Enron has some of the deepest pockets within the energy space, and few of its missteps have caused
any long-term damage

Nevertheless, it remains clear that wholesale power trading is where the company finds its bread and
butter, and thus no matter how Enron may perceive itself, investors still see it as primarily an energy
company (albeit, a unique one). That, ironically, is good news for Enron as the company is now trading
consistently high within the range of other energy traders, Excluding the broadband business, Enron has
a multiple of between 25 and 28 times next year's earnings, which is higher than other energy
competitors such as Dynegy (which trades for about 23 times next year's forecast) and Duke Energy
(which trades between 13 to 15 times projected earnings). The remaining question is whether or not
Enron is an overvalued stock. With diversified operations in telecom, water and the host of other
commodities the company has pursued, the answer may have been that Enron was valued appropriately
However, now that these businesses are struggling and most of the company’s focus is built around the
trading market, the future of which is uncertain, investors will most likely continue to carefully examine
Enron's future growth potential

An archive list of previous IssueAlerts is available at
www.scientech.com

IssuesWatch.

Miss last week? Catch up on the latest deregulation, competition and restructuring
developments in the energy industry with SCLENTECH's IssuesWatch

Reach thousands of utility analysts and decision makers every day. Your company can schedule a



and snap power lines.

Utility Crews Flock to Ark, To Help
Dec 29, 2000 - LITTLE ROCK, Ack. (AP) - There's a high-wire act going on over Arkansas,
cold and cranky after the second ice storm of the month plunged much of the state inte
darkness.

“This a Natural Disaster’ Situation in Many Areas Is Going from Bad to Worse
Dec 30, 2000 - Tulsa World With power lines and streets still covered in 2 inches of ice,
the hospital still had no water Thursday. The maximum- security pr was without
electricity. And half-frozen residents were straggling into shelters after toughing it out
for days in dark,unheated houses.

THU ELECTRIC & GAS CREWS RESTORE NEARLY 904 OF ICE VICTIMS
Dallas, TX - December 29, 2000 TXU Electric & Gas crews have restored service to nearly 90
percent of customers affected by a severe ice storm this week.

Legal

For more information about products on this topic visit our Information Marketplace

Baker to Take Charge Resulting From Judgement In ADF Litigation
PITTSBURGH-~ (BUSINESS WIRE)--Dec. 29, 2000-~ Michael Baker Corporation announced today
that a judgement of $10.0 million has been issued against its subsidiary, Baker Mellon
Stuart Construction, Inc., by the U.S. District Court for the Middle District Court of
Florida relative to the previously disclosed claim of ADF International, Inc., in
connection with the Universal Studios CityWalk project.

Plants

For more information about products on this topic visit our Information Marketplace

Huntington Beach, Calif., Power Plant Criticized for Increased Production
By Hanh Kim Quach, The Orange County Register, Calif. -- Dec. 29 When the AES Pacific
Corp. power plant in Huntington Beach cranked up its noisiest and most polluting power-
generating units this past month, it did not go unnoticed.

Drought Leaves Tacoma, Wash., Hydroelectric Reservoir Resources Below Normal
By Al Gibbs, The News Tribune, Tacoma, Wash. -- Dec. 30 More bad news for Northwest
electricity users: Rainfall and snowpack in the mountains whose streams fill the region's
hydroelectric reservoirs are well below what they should be.

Environmental

For more information about products on this topic visit our Information Marketplace

Grass Rooftops Save Energy, Cool Air in Cities
By Suzanne Elston, Environmental News Network, Sun Valley, =~ Dec. 30 During the summer
months, the temperature of a conventional flat rooftop can soar up to 140 degrees
Fahrenheit -- hot enough to fry an egg.

Nuclear


JUDICIARY

Unborn Victims

Constitution Subcommittee markup of H.R.503, the Unborn Victims
of Violence Act of 2001. 2237 RHOB. 2 p.m. Contact: 202-225-3951.
Juvenile Offenders

Crime Subcommittee markup of H.R.863, the Consequences for
Juvenile Offenders Act of 2001. 2237 RHOB. 10 a.m. Contact: 202-
225-3951.

SCIENCE

Earthquakes

Research Subcommittee hearing on life in the subduction zone.
2316 RHOB. 2 p.m. Contact: 202-225-6371.

INTELLIGENCE

Pending Matters

Pull committee briefing on pending intelligence matters. H-405
Capitol. 2 p.m. Contact: 202-225-4121. (New/Closed.)

TRANSPORTATION AND INFRASTRUCTURE

Highway Outlook

Highways and Transit Subcommittee organizational meeting and
hearing on the outlook for the nation's transit systems. 2167
RHOB, 10 a.m, Contact; 202-225-9446.

VETERANS’ AFFAIRS

Pending Legislation

Full committee markup of H.R.601, the Veterans’ Opportunities Act
of 2001, and H.R.81l, the Veterans’ Hospitals Emergency Repair
Act. 334 CHOB. $:15 a.m. Contact: 202-225-9164.

WAYS AND MEANS

Tax Relief

Full committee hearing on the president's tax relief provisions
that affect individuals. Witnesses: Rep. Gerald Weller, R-I11.;
Sen. Kay Bailey Hutchison, R-Texas; Bruce Bartlett, senior
fellow, National Center for Policy Analysis: Charles Donovan,
executive vice president, Family Research Council; Wendell
Primus, director, income security, Center on Budget and Policy
Priorities, 1100 LHOB. 10 a.m. Contact: 202-225-3625. (Revised.)
On the Hill Today

Campaign Finance

News conference for reintroduction of a campaign finance reform
bill, Participant: Rep. Asa Hutchinson, R-Ark. 2226 RHOB. 10 a.m.
Contact: Christian Brill, 202-225-4301,

DEFENSE

News conference on President Bush's budget request and the
adverse effect on veterans. Participants: Reps. Lane Evans, D-
Ill., Bob Pilner, D-Calif., John Dingell, D-Mich., Silvestre
Reyes, D-Texas, Victor Snyder, D-Arck., Ciro Rodriquez, D-Texas,
Ronnie Shows, D-Miss., Shelley Berkley, D-Nev., and Michael
Doyle, D-Pa. HC-9, Capitol. 1:30 p.m. Contact: Bill Crandell,
202-225-2506. (New.)

Democrats

Senate Democrats dugout news conference. Participant: Senate
Minority Leader Daschle. S-224, Capitol. 10:45 a.m. Contact: 202-
224-5556. (New.)

Environment

International Snowmobile Manufacturers Asan. Luncheon briefing to
unveil a new quieter and cleaner snowmobile. Participant: House
Ethics Chairman Hansen. 1334 LHOB.Noon. Contact: 517-891-1498.
(New. )

Water Environment Federation and American Society of Civil
Engineers Environmental and Water Resources Institute Washington
briefing. Participants:, 7:30 a.m., Rep. John Duncan, R-Tean.,


Calif power talks aim to reach solution on Saturday

WASHINGTON, Jan 12 (Reuters) - Treasury Secretary Lawrence
Summers, other senior Clinton administration officials and top
executives of electric power companies tentatively planned to
meet on Saturday to finalize a fix for California's power mess,
4@ source close to the negotiations said on Friday.

The high-level meeting was set to take place at the Energy
Department at 3:30 p.m. EST (2030 GMT), with some California
officials participating via teleconference, the source said.

The s fowly averted rolling power blackouts on
Thursday as already tight supplies of electricity fell to
dangerously low levels because of a severe storm.

Friday marked the fourth day of negotiations among
lower-level aides to map out detailed proposals for short- and
long-term solutions to California's chronic electricity
shortage and skyrocketing prices.

If the Friday talks failed to make as much progress as
hoped, the Saturday session could be downgraded to another day
of negotiations among lower-level officials on technical
issues, according to another source.

Summers and Energy Secretary Bill Richardson launched the
negotiations on Tuesday to prevent the bankruptcy of PG&E Corp
<PCG.N> and Edison International <EIX.N>, which could ripple
throughout the national economy,

Both utilities say they have run out of cash because of
runaway prices wholesale power, which are now tenfold higher
than one year ago. Under California's landmark 1996
deregulation law, the higher wholesale prices cannot be passed
through to consumers.

The two utilities want a $0-day reprieve in repaying
billions of dollars to out-of-state power generators, as well
as the ability to sign long-term contracts to lock in lower
prices.

( (washington, commodsenergy.news room@reuters.com) |

REUTERS
Rte 15:29 01-12-01

sTICKER: PCG EIX

?SUBJECT: CRUD COBO MU ENER UTIL USA
Copyright [c) 2001 Reuters

Received by NewsEDGE/LAN; 1/12/01 3:24 PM

“DJ POWER POINTS: By The Numbers, Calif Pwr Deal Leoks Good

Dow Jones International News Service via Dow Jones

By Mark Golden
A Dow Jones Newswires Column

NEW YORK (Dow Jones)--Grandstanding by negotiators in Washington, D.C., on the
California electricity crisis indicates the sides are too far apart for an
agreement this weekend, but the actual numbers involved raise the question: How
can they not get this done?

California Gov. Gray Davis, on behalf of the utilities that contribute so
generously to his campaign funds, is demanding three-year supply contracts at
5.5 cents a kilowatt-hour. "We've got to stop the hemorrhaging of utility cash,
but I can’t possibly have another rate increase or any state bailout,” the
governor is saying.

According to sources, U.S. Treasury Secretary Lawrence Summers and the


But Still Faces Several Hurdles

By Will McNamara
Director, Electric Industry Analysis

[News tem from PR Newswire] Enron Corp. announced today a 32-percent increase in
diluted earnings per share to $0.45 for the second quarter of 2001 from $0.34 a year ago.
Strong results in the quarter include a 40-percent increase in net income to $404 million.
Enron also announced both confidence in achieving $1.80 of recurring earnings per
diluted share for the full year 2001 and new guidance for 2002 of $2.15 per diluted share

Analysis: Enron's strong 2Q earings report is good news for the company, considering
that 2001 has not gotten off to the best start for several of its key operational areas. For

= several weeks, Wall Street has been pondering the question of what has caused Enron's
stock to hit its lowest level in 18 months (plunging approximately 40 percent since January 2001)
Granted, Enron is a company with a market capitalization of $36 billion, current assets in the range of
$7.3 billion and reportedly $288 million in cash, so any previous drop in its performance must be taken
in that context. However, for a company that is generally considered to be the largest natural-gas and
electricity trader in the world, and one that sparks international awe for what has been (with few
exceptions) a Midas touch, any indication that Enron may be faltering even slightly is grounds for
industry analysis. Thus, Jeffrey Skilling, Enron's CEO, is taking full advantage of the company’s better-
than-expected performance in the second quarter to reassure investors that Enron is once again on track.
Nevertheless, the company continues to face significant obstacles in five key areas (outlined below), and
some analysts claim that Enron's fall is far from over.

Without a doubt, Enron's 2Q numbers are impressive. The 2Q income of $404 million, or 45 cents a
share, represents a 40-percent increase from the same quarter in 2000. However, it is important to note
that Enron's marketing and trading enterprise kept the company in a financially strong position and
offset losses that occurred in other areas of the company. In fact, the vast majority of Enron's profits (97
percent, to be exact) are coming from the company's wholesale services division, which includes its
trading unit, Although the wholesale trading unit's revenue of $48.48 billion was basically flat with 1Q
2001 revenue of $48.51 billion, it was up 204 percent from 2000 levels. In addition, the company's
wholesale business reported 2Q operating eamings of $802 million, up 6 percent from the previous
quarter and 93 percent above 2Q 2000. Further, Enron's natural-gas volumes increased by 9 percent and
electricity-trading volumes increased by 71 percent in the second quarter. European trading operations
are also booming, with Enron's power volumes nearly quintupling to 73 million megawatt-hours across
the Continent

It seems fairly obvious that the wholesale trading business takes the credit for the company's strong
financial performance in the second quarter, and without the heavy reliance on this business Enron
probably would not have exceeded analysts’ expectations. However, some analysts fear that Enron's
heavy reliance on wholesale trading could compromise 3Q 2001 results, considering the combination of
possible softening demand, dropping market prices for energy and the belief that the California energy
crisis has peaked. Thus, Enron has invested large sums of money in more diversified businesses over the
last year or two and currently remains entangled in several operations that could quickly become
anchors around the company’s ankle. In other words, although Enron continues to make attempts to
diversify beyond its electric- and natural gas-trading core, it faces obstacles in the following areas:

Bandwidth: Enron Broadband Services, a wholly owned subsidiary of Enron Corp. that launched last
year to focus on bandwidth and telecommunications infrastructure, has clearly become the dark cloud


the political parties in the last two years, according to the
nonpartisan FECInfo, But the Baby Bells' top priority--broadband
legislation--was never even been brought up for a vote in a
single congr donal committee. Another Bell priority, a bill to
end so-called reciprocal compensation payments, was buried by the
very same House Republicans who were collecting all the corporate
Bell checks.

One of the Baby Bells, SBC Communications, was the fourth
largest soft money contributor, with $1.78 million, while Bell
sibling Verizon Communications ranked eighth with $1.46 million.
Belisouth and Qwest Communications kicked in another $940,000 and
$830,000, respectively. To be sure, ATéT--the leading soft mon:
contributor in 1999-2000--helped block the Baby Belis' pet bills.

But even the former Ma Bell, which rang up $3.6 million in
soft money during the cycle, could not buy the support it needed
to accomplish its most important goal of the session:
Congressional leaders disconnected a last-minute bid by AT&T to
tuck a provision into a must-pass appropriations bill to lift
federal limits on the size of cable companies. A federal court
was more receptive, however, striking down the cable limitation
earlier this month.

Even when the entire Bell family partnered with long-distance
companies MCI, WorldCom and Sprint in an attempt to eliminate a
century-old tax on phone service, the combined $10 million in
soft money contributions could not purchase an unblemished
victory. Congress passed the bill, but former President Clinton
refused to sign it.

The telecommunications giants are not alone. Other major soft
money contributors of the 1999-2000 election cycle finished the
106th Congress without a clear legislative victory.

Everyone knows how Microsoft ($1.67 million in soft money)
fared. Enron (No. 13 with $1.16 million) and its CEO Ken Lay
($325,000) could not spark action on a bill to restructure the
nation's electricity markets. And Lockheed Martin Corp. (No. 15
with $1.15 million) suffered several high-profile setbacks.

Still, several of the largest soft money givers scored subtle
victories by running cut the clock on their opponents’
legislative priorities. Freddie Mac ($2.4 million) slammed the
door on legislation that would have welcomed new competition into
its neighborhood,

Other generous soft money givers that did not score direct
legislative wins on Capitol Hill earned important victories from
federal agencies during the cycle. Federal Express ($1.46
million) and UPS ($1.33 million) each received important landing
fights from the FAA. Meanwhile, AT&T, Verizon, SBC and No. 11
Citicorp ($1.29 million) secured federal approval for huge
corporate mergers.

Still other companies that gave handsomely could be preparing
for upcoming legislative battles on Capitol Hill, according to
campaign finance experts. "They may not have anything specific
now but they may be laying the groundwork for a receptive
Congress or administration in the future," said Kent Cooper, who
runs FECInfo. "You need to make your friends before you need
them."

Lobbyists for the top corporate contributors say the donations
are not intended to guarantee approval of their top congressional
priorities. "It's not as simple as: “Put money in here, output
legislation here,'" observed one industry lobbyist.

As evidence, the lobbyist pointed to the phone industry's
partnership to end the telephone tax. Considering the soft money
SS by the industry in support of ite allies, the lobbyist
“that should have been a slam dunk.” -- By Brody Mullins

LABOR
Legislators Push New Ergonomics Action As Bush Signs Repeal


that is hovering over the company. Ironically, it was this business that contributed to the dramatic
increase in Enron's stock value last summer. At that time, Enron claimed to have a large number of
potential deals in the pipeline for its telecommunications business and, based on this optimism, Wall
Street inflated Enron shares by as much as 75 percent (causing the company's stock to hit a peak of $90
in August 2000), However, in 2Q 2001, Enron's broadband business reported a $102 million operating
loss, compared to an average loss of just $24 million for the four previous quarters. Further, Skilling has
openly acknowledged that revenue opportunities in the company's broadband unit have "dried up.”
Basically, Enron is facing an unanticipated excess of fiber-optic lines, which has prevented the demand
for the division's services from materializing as anticipated. Last week, Enron announced that further
cutbacks would take place in the Portland, Ore., office of Enron Broadband Services, including the
elimination of 100 jobs (250 positions were cut last April). Moving forward, Enron Broadband Services
will focus exclusively on two key areas: bandwidth trading and package services for business customers
(which would basically include the delivery of data and entertainment through fiber-optics), Skilling
remains optimistic that the business will become profitable, but that it may be a year or two before that
occurs.

India; For background on what has become an international debacle for Enron, see the 5/22/01
IssueAlert (available at www,scientech.com/rci), In essence, Enron has been attempting to end a
contract for power delivery to the state of Maharashtra, India, which it has served for about six years, in
response to the government's discontinuation of payment. In the mid-1990s, Enron broke ground on a
2,184-MW, natural gas-fired project on India's western coast (near Bombay, which is the capital of
Maharashtra). The plant is in the midst of its first operational phase (with 750 MW up and running) and
was scheduled to begin its second phase (1,444 MW) in June. However, problems began to surface over
the last six months or so, heightened by Maharashtra’s recent default on payments to Enron, The
Maharashtra government claimed that Dabhol Power, an Enron subsidiary that oversees the power
contract in India, is overcharging for power. Other companies such as AES are now attempting to take
over the contract between Enron and the Maharashtra government. However, at last count, the state
government owes Enron approximately $48 million for power transactions completed last December and
January, and could owe $607 million if the contract is terminated

California: Enron's problems in California have been well documented, as the company has been
singled out (along with other power suppliers) by the state’s governor and federal regulators for possible
price gouging. Along with new price controls, possible refunds for past power sales and decreased
demand in the state, Enron also faces several pending lawsuits related to its California business. At
present, Enron and other companies await a ruling from FERC regarding the specific amount that power
suppliers may collectively owe back to the state of California. Gov. Gray Davis has demanded $8.9
billion and vows to take the case to federal court if FERC issues refunds of less than that amount. In
addition, the California Senate is deliberating over whether Enron should be held in contempt of court
regarding its refusal to supply confidential business documents as required by subpoena.

Water: Azurix, Inc., Enron's global water company that is primarily engaged in the business of owning,
Operating and managing water and wastewater assets, has been losing money since its formation in

1998. Most recently, in 2Q 2001, Enron reported a loss of $109 million in its "corporate and other"
businesses, which includes Azurix and other non-core businesses. This followed an even-worse
performance for year-end 2000, which included a 4Q 2000 loss of $470 million that Azurix took for
failing to negotiate customer rates as part of a water-services contract in Argentina. Since last fall, Enron
has been attempting a buy-out of Azurix in an effort to make the company a private entity once again.
Nevertheless, Enron continues to bear the burden for Azurix's struggles, which many attribute to Enron's
overly optimistic view of how quickly privatized water markets would materialize

Florida Merchant Plants; Enron has attempted to penetrate Florida's $13-billion electric market with


power reserves.

On Thursday, power reserves in California dipped below 2 percent
after a storm cut production at a key nuclear station.

The Independent System Operator, which manages most of the
st power grid, said electricity supplies had rebounded but
were still tight.

Davis and Govs. John Kitzhaber of Oregon and Gary Locke of
Washington said Friday that they would urge their residents to cut
electricity demand 7 to 10 percent, try to reduce power use by
their state governments by at least 10 percent, and look into
joining forces to buy energy-efficient preducts for state and local
agencies to get through the cri

Davis and California's two largest investor-owned utilities have
pointed fingers at energy wholesalers, saying they have exacerbated
the crisis by taking advantage of the tight supplies for their own
profit.

Pacific Gas & Electric Co. and Southern California Edison, both
electricity reta 3, say they have lost more than $$ billion
because of wholesale price increases and the state's 1996
deregulation law that froze rate hikes. The utiliti which won
permission to raise rates, said the temporary increases approved by
the state Public Utilities Commission weren't enough and have
warned they could go bankrupt if something isn't done,

Davis, Kitzhaber and Locke said in a written statement that the
Federal Energy Regulatory Commission should impose immediate
wholesale price controls.

The federal government must take up its responsibility to
prevent the chaos that threatens to engulf the entire western
electricity system,'* the governors said.

Sen. Dianne Feinstein, D-Calif., said she would propose
legislation to give the U.S. energy secretary authority to cap
skyrocketing wholesale electricity prices in 11 western states. It
would let the secretary impose a temporary wholesale price cap if
there is “unjust pricing'' and would remain in effect until prices
atabilized, said Howard Gantman, the senator's spokesman.

About 30 officials, including Davis, key members of the state
Legislature, the head of the state's Public Utilities Commission
and utility representatives, gathered at the Ronald Reagan Building
in downtown Los Angeles to confer with counterparts on the other
side of the country.

Linked from Washington were Sperling, Treasury Secretary
Lawrence Summers, James Hoecker of the Federal Energy Regulatory
Commission, Deputy Energy Secretary T.J. Glauthier and officials
from power companies.

White House says Calif must act on power crisis

WASHIN + Jan 13 (Reuters) - Clinton administration
officials said late Saturday that a framework agreement to
settle California's power crisis and stave off bankruptcy for
two major utilities must be reached by state lawmakers and the
governor by Tuesday.

Gene Sperling, director of the National Economic Council,
said it was up to California Gov. Gray Davis and state
lawmakers to finalize a solution to the crisis over the next
two days.

“The governor laid out a framework for him and the
legislative leadership to work on," Sperling told reporters
after a seven-hour meeting with state officials and industry
executives. "The issue is now for them to work out the
proposal

Treasury Secretary Lawrence Summers, who led the session,
said the California officials recognized the need to reach a
settlement by Tuesday. Clinton administration officials also
said they would be willing to reconvene high-level talks if the
California governor and state lawmakers could not work out a



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Budington, Michele,

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Cetina, Jill,

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Doml3.DOPO8.CHAVESM, GWISE:Doml3.DOPO8.CHAVESM
Eichenberger, Joe,

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Pall, James, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=GROUPWISE/CN=DOM13, DOPOG. FALLJ
Geithner, Timothy,

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Gelpern, Anna,

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John, James, EX: /O*USTREASURY/OU*DO/CN*RECI PIENTS/CN*GROUPWISE/CN*DOM13.DOPOS. JOHN
Lee, Nancy, EX: /O*USTREASURY/OU*DO/CN*RECIPIENTS/CN*GROUPWISE/CN*DOM13. DOPOS. LEEN
Lowery, Clay,

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Ludden, Ken,

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Schuerch, William,

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Stedman, Louellen,

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Truman, Ted,

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Alagiri, Priya,

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Andrews, Lisa,

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Bordoff, Jason,

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Carter, Jana,

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Comstock, Neal,

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Eizenstat, Stuart,

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Grayson, Cherry,

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Johnson, Linda,

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Joseph, Verlene,

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Keene, Carolyn,

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By Will McNamara
Director, Electric Industry Analysis

Deerfield Beach, Fla., gave Enron the green light to build a natural gas-fired power plant
just one mile north of a site it abandoned earlier in the same week amid fierce opposition
The unanimous approval from the city’s development committee all but clears the way for
the Texas-based company to go forward with seeking further permitting requirements on
the $10-MW plant. Enron still needs a state air quality permit, something that nearby
cities have said that they will fight. Assuming that Enron receives all the necessary
approvals, the company could begin building the plant within the next year

TM Analysis: The press materials surrounding this announcement, which is being presented
as a coup for Enron in the Florida market, may belie the fact that the energy powerhouse continues to
face an uphill battle to bring this new power plant into the state. Amidst new reports that Florida may
face a power shortage, resistance toward new power plants in the state ins high among community
groups and incumbent utilities. Further, while Enron has put its reputation in jeopardy in Florida by a
taking an aggressive route toward gaining a foothold in the state's wholesale generation market, other
out-of-state power companies have not encountered as much resistance by forming less-controversial
power contracts,

First, there are some fundamental aspects of Florida's $13 billion electric market that should be
established for context. The state has taken a “go slow” approach toward electric competition and, at this
point, there is no plan to initiate retail competition in Florida. However, leaders of the state (including
Gov. Jeb Bush) have supported competition in the state's wholesale market in an effort to move
cautiously toward total deregulation. Florida's Energy 2020 Study Commission, which is preparing the
blueprint for competition in the state, endorsed a plan to allow out-of-state companies to enter Florida's
wholesale market by building new plants and selling power to the state's incumbent utilities. However,
the Florida Supreme Court has banned out-of-state companies (such as Enron) from building merchant
plants in the state, which would be free to sell power anywhere and are not subject to rate regulation by
the state's regulatory commission. Florida law does allow out-of-state companies to build peaker plants,
as long as they only operate in times of especially high demand when normal supplies are strained

It is into this climate that Enron began making attempts to penetrate Florida's wholesale market about a
year ago. Enron maintains that its policy is to seek multiple sites for power plants when it moves into a
new market, and thus has several pending Florida locations on its radar. Yet, the first site that Enron
selected for a new peaking unit was recently scrapped when Enron faced substantial community
resistance from groups that were concerned about the plant's impact on the environment, A proposed
plant in Pompano Beach sparked an intense public outcry from groups concemed that diesel output,
which Enron planned to use as a back-up fuel source for the plant, would be a major source of air
pollution. Just last week, Enron withdrew its application to build the plant in Pompano Beach, although
the company denied that public resistance was a factor, Instead, Enron says that it has simply chosen to
concentrate on building plants in other Florida cities, including Deerfield Beach

Luckily for Enron, zoning rules in Deerfield Beach, which is less than a mile north of Pompano Beach,
put the approval or rejection of the plant solely in the hands of a staff committee instead of an elected
body. Due to a complex annexation law in the state, staff members of the Deerfield Beach City Hall (and
not elected officials) had the final say on the plant. Thus, there was little opportunity for the public to
wage an opposition campaign against the plant and elected officials reportedly had no authority to
approve of reject the plant. In addition, Deerfield Beach is zoned primarily for businesses, which
arguably makes it a more appropriate location for the new plant than the more residential Pompano


For more information about products on this topic visit our Information Marketplace

Lithuania secures EV funding to shut down reactor
VILNIUS, Dec 29 {AFP} ~ Lithuania's government said Friday it had obtained a loan of 45
million euros (42 million dollars) from the European Union to help it decomission the
first reactor unit at Ignalina nuclear power station.

Disputed Czech N-plant powering up again after glitch
PRAGUE, Dec 29 (AFP) ~ A disputed Czech nuclear plant plagued by technical problems has
powered up to 29 percent of its capacity, and is due to be re-connected to the national
power grid Saturday, a spokesman said Friday.

Jordan to launch first nuclear power plant in year's time
AMMAN, Dec 31 (AFP) - Jordan will start operating a small nuclear power reactor in early
2002 for scientific research and other non-military purposes, Jordan's energy minister was
quoted Sunday as saying.

PPL's Susquehanna Nuclear Plant Sets Generation Record
ALLENTOWN, Pa., Jan. 1 /PRNewswire/ PPL's Susquehanna nuclear plant preduced more
electricity in 2000 than it has in any year since the plant began operation in 1983.

EU grants Lithunia govt 45 mln eur for Ignalina nuclear plant decommissioning
Dec 29, 2000 ~ AFX News Limited The EU has granted Lithuania 45 mln eur to help
decommission the first block of the Ignalina nuclear power plant, the minister for foreign
affairs said.

Financial

For more information about products on this topic visit our Information Marketplace

Greenspan's California Power Crisis Talks Boost Hopes for US Rate Cut
Dec 27, 2000 - The Independent ~ London HOPES THAT the US Federal Reserve may cut interest
rates early in the new year resurfaced yesterday as Alan Greenspan, the chairman, met the
Governor of California in Washington to discuss a crisis that threatens to bankrupt the
state's two biggest power utilities.

PG&E Workers May Lose Their Annual Bonuses / PG&E Workers May Lose Their Annual
Bonuses
Dec 30, 2000 - The San Francisco Chronicle As Northern California consumers face the
prospect of big increases in their power bills, employees of Pacific Gas and Electric Co.
are looking at the likelihood that annual performance-based bonuses will be reduced or
even eliminated this year.

Black Hills Corporation Obtains Holding Company Approval and Announces Shelf
Registration for Future Capital Offerings
RAPID CITY, S.D., Dec. 28 /PRNewswire/ -- Black Hills Corporation today announced the
culmination cf approvals resulting in the formation of a holding company business
structure, Shareholders had earlier ratified the change at the Company's annual meeting on
June 20, 2000. Effective December 22, 2000, outstanding shares were automatically
exchanged on a one-for-one basis for shares of the holding company.

Product Annoucement



pet stake in VIAG Interkom GmbH to British Telecommunications PLC.

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PRESS RELEASES


From; Wolin, Neal
Sent: Thursday, February 21, 2002 1:10 AM
To: SearchCameo

CAMEO Recon found a word: Enron sent by Posner, Steven to Smith, Michelle A.; Klasky,
Helaine; Weaver, Elizabeth; Gallagher, Una; Buck, Bill; Gensler, Gary; Sachs, Lee; Stewart,
Lawranne; Greene, Michelle; Wilcox, David; Elmendor, Douglas; Vandivier, Dav

This message was found to have a Critical Word in it. Message Sent to Smith, Michelle A.;
Klasky, Helaine; Weaver, Elizabeth; Gallagher, Una; Buck, Bill; Gensler, Gary; Sachs, Lee;
Stewart, Lawranne; Greene, Michelle; Wilcox, David; Elmendorf, Douglas; Vandivier, David:
Sandberg, Sheryl: Stern, Todd; Cohen, Alan; Wolin, Neal; Moe, Martin, From Posner, Steven,
CC to , Date 1/12/2001 4:28:58 PM, Subject of message wires - California Power Talks

Word(s) found: Enron

~----Original Message----~

From: Posner, Steven

Sent: 1/12/2001 4:28:58 PM

Received: 1/12/2001 4:28:58 PM

To: Smith, Michelle A., EX:/O-USTREASURY/OU=DO/CN=RECIPIENTS/CN=SMITHM
Klasky, Helaine, EX: /O-USTREASURY/OU*DO/CN*RECIPIENTS/CN#KlaskyH
Weaver, Elizabeth, EX: /O-USTREASURY/CU*DO/CN*RECIPIENTS/CN*WEAVERE
Gallagher, Una, EX: /OeUSTREASURY/OU*DO/CN@RECI PIENTS/CN#GALLAGHERU
Buck, Bill, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=BUCKW
Gensler, Gary, EX:/O=USTREASURY/OU=DO/CN#RECIPIENTS/CN=GENSLERG
Sachs, Lee, EX:/O=USTREASURY/OU=D0/CN@RECIPIENTS/CN=SachsL
Stewart, Lawranne, EX:/O=-USTREASURY/OU=DO/CN=RECIPIENTS/CN=STEWARTLAW
Greene, Michelle, £X:/O=USTREASURY/OU=D0/CN=RECI PIENTS/CN=GREENEME
Wilcox, David, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=WILCOXD
Elmendorf, Douglas, EX:/O=USTREASURY/OU=D0/CN=RECI PIENTS/CR=ELMENDORFD
Vandivier, David, EX:/O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=VandivierD
Sandberg, Sheryl, EX: /O=USTREASURY/OU=D0/CN=RECIPIENTS/CN=DOM3. DOPOS,Sandbergs
Stern, Todd, EX: /O=USTREASURY/OU=DO/CN=RECIPIENTS/CN=DOM3.DOPOS.SternT
Cohen, Alan, EX:/O=USTREASURY/OU*=DO/CN=RECIPIENTS/CN=DOM3. DOPOS. COHENA
Wolin, Neal, EX:/O*USTREASURY/OU*DO/CN*RECIPIENTS/CNeWOLINN
Moe, Martin, EX:/O-USTREASURY/OU=DO/CN+RECI PIENTS/CH+DOM3.DOPOS.MoeM

ce:

Subject: wires - California Power Talks

Body:

DJ Principals In Calif Pwr Talks Set To Reconvene Saturday

Dow Jones International News Service via Dow Jones

WASHINGTON [Dow Jones}--The principal negotiators involved in White
House-brokered talks to solve California's electricity crisis are slated to
reconvene here Saturday afternoon, the U.S. Treasury Department confirmed
Friday.

The resumption of high-level talks among top-ranking officials representing
the Clinton administration, California, and utilities and power suppliers will
take place at U.S. Department of Energy headquarters at 3:30 p.m. EST.

California Gov. Gray Davis and other key state regulators and lawmakers are to
participate via a video conferencing link.

The pivotal negotiating session comes after two working groups involving
lower-level officials have met since Wednesday in an effort to flesh out the
details of a broad settlement package the principals discussed late Tuesday
during a seven-hour meeting at the Treasury Department.