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                                                                    EXHIBIT 99.2

                               102 FERC (P) 61,315

                            UNITED STATES OF AMERICA
                      FEDERAL ENERGY REGULATORY COMMISSION

Before Commissioners: Pat Wood, III, Chairman;
                      William L. Massey, and Nora Mead Brownell.




Reliant Energy Services, Inc.                        Docket No. EL03-59-000

BP Energy Company                                    Docket No. EL03-60-000


           ORDER PROPOSING REVOCATION OF MARKET-BASED RATE AUTHORITY


                             (Issued March 26, 2003)

1. This order directs Reliant Energy Services, Inc. (Reliant) and BP Energy
Company (BP Energy) to show cause to the Commission in paper hearings why their
authority to sell power at market-based rates/1/ should not be revoked by the
Commission in light of their apparent manipulation of electricity prices at the
Palo Verde, Arizona trading hub, in violation of Section 205(a) of the Federal
Power Act's (FPA) requirement that rates be just and reasonable./2/ This order
also initiates proceedings under Section 206 of the FPA,/3/ in Docket Nos.
EL03-59-000 (for Reliant) and EL03-60-000 (for BP Energy), where the show cause
filings will be considered.

2. This order is necessary to fulfill the Commission's obligation to monitor
competitive markets in order to protect wholesale electricity customers from
unjust and unreasonable rates.

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     /1/ Reliant and BP Energy are power marketers previously authorized to sell
electric power at market-based rates. See Office Director Letter Orders issued
on July 25, 1994 in Docket No. ER94-1247-000 and March 12, 1999 in Docket No.
ER99-1801-000 (granting Reliant market-based rate authority); Office Director
Letter Orders issued on June 17, 1999 in Docket No. ER99-2895-000 and October
18, 2000 in Docket No. ER00-3614-000 (granting BP Energy market-based rate
authority).

     /2/ 16 U.S.C. (s) 824d(a) (2000).


     /3/ 16 U.S.C. (s) 824e (2000).


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Docket Nos. EL03-59-000 and EL03-60-000                                    - 2 -


Background

3. On February 13, 2002, the Commission directed a Staff fact-finding
investigation into whether any entity manipulated prices in electricity or
natural gas markets in the West or otherwise exercised undue influence over
wholesale electricity prices in the West, since January 1, 2000./4/

4. On August 13, 2002, Staff released its Initial Report in Docket No.
PA02-2-000./5/ In that Report, Staff recommended the initiation of various
company-specific proceedings/6/ to further investigate possible misconduct, and
recommended several generic changes to market-based tariffs to prohibit the
deliberate submission of false information or the deliberate omission of
material information and to provide for the imposition of both refunds and
penalties for violations.

5. In Staff's Final Report, being publicly released concurrently with this
order,/7/ Staff notes evidence that indicates that Reliant and BP Energy appear
to have engaged in coordinated efforts to manipulate electricity prices.

6. Specifically, Staff points to three occasions where a BP Energy trader called
a Reliant trader and asked him to buy power from an offer he was going to place
on an electronic trading platform (Bloomberg). The Reliant trader would then
sell the power back to the BP Energy trader at the same price, but the
transaction would not take place on the electronic trading platform.

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     /4/ Fact-Finding Investigation of Potential Manipulation of Electric and
Natural Gas Prices, 98 FERC (P) 61,165 (2002) (February 13 Order).

     /5/ The Initial Report is available on the Commission's Web site at
www.ferc.gov/electric/bulkpower/pa02-2/Initial-Report-PA02-2-000.pdf.

     /6/ These proceedings, which are currently pending before the Commission,
are Docket Nos. EL02-113-000, EL02-114-000, and EL02-115-000.

     /7/ Final Report on Price Manipulation in Western Markets (Docket No.
PA02-2-000 March 2003). The Staff Final Report is available on the Commission's
website. We will incorporate the Staff Final report, and the underlying record
in Docket No. PA02-2-000, by reference into the records in these proceedings.

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Docket Nos. EL03-59-000 and EL03-60-000                                    - 3 -


7. On one of the occasions the BP Energy trader with the aid of Reliant's trader
appears to have manipulated the price of electricity delivered at Palo Verde, a
trading hub in Arizona to affect the value of his trading position (such that a
higher price raises the value of the trader's portfolio).

8. Recorded telephone conversations and transcripts provided to Staff by Reliant
in Docket No. PA02-2-000 document the manipulation./8/ The BP trader contacted
the Reliant trader and offered a transaction. The BP trader would offer to sell
electricity on the Bloomberg electronic platform, the Reliant trader would buy
at the posted price, and the BP trader would then buy back the power (off the
Bloomberg electronic platform) at the same price to undo the sale. The BP trader
goes on to explain that he is trying to move the market price up to $43.10 but
no one will buy it at that price, so he needs the Reliant trader to "lift his
offer"/9/ in order to increase the price.

9. Several days later the same BP trader contacted the same Reliant trader and
offered a similar proposal, again, apparently to manipulate the price in order
to increase the value of his trading position under the company's mark-to-market
accounting.

10. The BP trader goes on to explain that they are marking their books on the
October Palo Verde price. He notes that power for delivery in October at Palo
Verde had traded as high as $44, and he wants to move the price even higher
because of his long position. He indicates that he will post an offer to sell at
$44.15 and asks the Reliant trader to lift that offer and then he will buy it
back from him at the same price. The BP trader then posts the offer on the
Bloomberg electronic platform. Shortly thereafter, the BP trader asks the
Reliant trader to lift the offer because he senses the market beginning to move.
The Reliant trader lifts the offer and asks the BP trader what they should do
next. The evidence indicates that the BP trader informed the Reliant trader that
he will buy the power back at the same price.

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     /8/ The conversations and transcripts are non-public. They will be made
available to parties subject to an appropriate protective order.

     The Staff's Final Report indicates that when Staff asked BP Energy for
information and telephone transcripts containing other information concerning
these events, BP Energy stated simply that it had no information regarding the
activity of its trader because it did not keep telephone records.

     /9/ I.e., to buy at the price posted on the Bloomberg electronic platform.


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Docket Nos. EL03-59-000 and EL03-60-000                                    - 4 -


Discussion

11. We find that BP Energy and Reliant, in the transactions identified above,
appear to have manipulated electricity prices at Palo Verde, an important
trading hub./10/

12. The Commission's grant of authority to sell power at market-based rates, as
opposed to at cost-based rates, depends on a functioning, competitive market for
wholesale power unimpaired by market manipulation. Moreover, implicit in
Commission orders granting market-based rates is a presumption that a company's
behavior will not involve fraud or deception. Companies failing to adhere to
such standards are subject to revocation of their market-based rate
authority./11/

13. The information in Staff's Final Report indicates that BP Energy and Reliant
appear to have violated FPA Section 205(a)'s requirement that rates be just and
reasonable by manipulating the electricity prices at Palo Verde./12/ In view of
the foregoing, we are therefore requiring Reliant and BP Energy to show cause to
the Commission in a paper hearing why the Commission should not revoke their
market-based rate authority. The Commission will institute FPA Section 206
proceedings and direct BP Energy and Reliant to show cause in those proceedings
why their market-based rate authorizations should not be revoked.

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     /10/ The Palo Verde trading hub previously was presumed to be liquid and
not subject to price manipulation. The transactions identified and discussed
above suggest that that presumption is not true. In addition, although
electricity price indices are not as critical a part of the market price
formation process in the electric industry as natural gas price indices are in
the natural gas industry, they were nevertheless considered by many to be an
important part of electricity market price discovery.

     /11/ Fact Finding Investigation of Potential Manipulation of Electric and
Natural Gas Prices, 99 FERC (P) 61,272 at 62,153-54 (2002); accord Investigation
of Terms and Conditions of Public Utility Market-Based Rate Authorizations, 97
FERC (P) 61,220 at 61,975-77 (2001); GWF Energy, LLC, et al., 98 FERC (P) 61,330
at 62,390 (2002); New York Independent System Operator, Inc., 91 FERC (P) 61,218
at 61,798-800 (2000), order on reh'g, 97 FERC (P) 61,155 (2001); Washington
Water Power Company, 83 FERC (P) 61,097 at 61,462-64, order in response to show
cause presentation, 83 FERC (P) 61,282 (1998); Kansas City Power & Light
Company, 74 FERC (P) 61,066 at 61,175, order on reh'g, 75 FERC (P) 61,244
(1996).

     /12/ Further context is provided in the Staff's Final Report.


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Docket Nos. EL03-59-000 and EL03-60-000                                    - 5 -


14. In cases where, as here, the Commission institutes Section 206 proceedings
on its own motion, Section 206(b) requires that the Commission establish
effective dates that are no earlier than 60 days after publication of notice of
the Commission's investigation in the Federal Register, and no later than five
months subsequent to expiration of the 60-day period. In order to give maximum
protection to customers, we will establish the statutorily-directed effective
dates, in this context the dates that we would revoke their market-based rate
authorities, at the earliest date allowed,/13/ 60 days after publication of the
order initiating the Commission's investigations in Docket Nos. EL03-59-000 and
EL03-60-000 in the Federal Register. In addition, Section 206 requires that, if
no final decision has been rendered by that date, the Commission must provide
its estimate as to when it reasonably expects to make such a decision. Given the
times for filing identified in this order, and the nature and complexity of the
matters to be resolved, the Commission estimates that it will be able to reach a
final decision by July 31, 2003.

The Commission orders:

(A) Reliant is hereby directed, within 21 days of the date of this order, to
show cause to the Commission in a paper hearing, in Docket No. EL03-59-000, why
it should not be found to have violated Section 205 of the FPA and why its
market-based rate authority should not be revoked.

(B) BP Energy is hereby directed, within 21 days of the date of this order, to
show cause to the Commission in a paper hearing, in Docket No. EL03-60-000, why
it should not be found to have violated Section 205 of the FPA and why its
market-based rate authority should not be revoked.

(C) The Secretary shall promptly publish a copy of this order in the Federal
Register.

(D) The effective dates in Docket Nos. EL03-59-000 and EL03-60-000 will be 60
days following publication in the Federal Register of the order discussed in
Ordering Paragraph (C) above.

(E) Pursuant to the authority contained in and subject to the jurisdiction
conferred upon the Federal Energy Regulatory Commission by Section 402(a) of the
Department of Energy Organization Act and the Federal Power Act, particularly
Section

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     /13/ See, e.g., Canal Electric Company, 46 FERC (P) 61,153, reh'g denied,
47 FERC (P) 61,275 (1989).

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Docket Nos. EL03-59-000 and EL03-60-000                                    - 6 -


206 thereof, and pursuant to the Commission's Rules of Practice and Procedure
and the regulations under the Federal Power Act (18 C.F.R. Chapter I), the
Commission hereby institutes investigations of BP Energy's and Reliant's
market-based rates, in Docket Nos. EL03-59-000 and EL03-60-000, respectively, as
discussed in the body of this order.

(F) Any interested person desiring to be heard in these proceedings should file
notices of intervention or motions to intervene with the Federal Energy
Regulatory Commission, 888 First Street, N.E., Washington, DC 20426, in
accordance with Rule 214 of the Commission's Rules of Practice and Procedure (18
C.F.R. (s) 385.214) within 21 days of the date of this order.

(G) Responses to the show cause submissions filed pursuant to Ordering
Paragraphs (A) and (B) above may be submitted within 15 days of the date of
filing of the show cause submissions.

By the Commission.

( S E A L )






                                                Magalie R. Salas,
                                                  Secretary.