 rain program and other implementation issues.

Stack Testing and CEMS Certification at Wheatland Power - Gus Eghneim
submitted petitions to EPA to delay any stack testing until summer 2001.  The
delay would save EES OEC and estimated $400,000 by allowing the plant to
perform the test during routine operating times and not just for testing. The
petitions are anticipated to go through the policy review committee by
October 2, 2000.

State Inspection at New Albany Power - New Albany Power was inspected by the
State of Mississippi on 9/22/00.  No issues were identified in the
inspection.

Safety Video Project Script - Scott Watson devised "rough draft" script for
the New Hire Employee and Contractor Safety Video projects.

Gaza Palestine Power Plant - Scott Watson completed new Hire Safety/Health
Training Outline as well as shipped training materials to Gaza.  This
training is to be conducted on October 7th & 8th, 2000 at the Gaza facility.

Legislation

Pipeline Safety -- Legislative situation still remains active, with a strong
possibility that the House will take up the Senate-passed legislation early
next week.   In anticipation of resistence from some Democrats who are
opposing the bill for purely political reasons, we have stepped up lobbying
efforts with key Democratic constituencies and other interest groups who can
provide support to the legislation (gas users, governors, steel industry,
etc.).    Jeff will be speaking on this topic at the ETS management
conference on Wednesday, October 4.

MTBE -- prospects for legislation this Congress are looking bleak.  The only
possibility for legislation to move is to attach the Senate Environment
Committee-passed bill to an appropriations bill, and many key congressional
leaders are opposed to this strategy because of the controversy surrounding
the legislation.   We are making sure that key advocates are armed with
industry transition/conversion funding amendments in case a last-minute
effort to attach an MTBE ban to some moving legislation is attempted.

Intelligence/Strategies

Clean Air Act/New Source Review -- the EPA Environmental Appeals Board last
Friday rejected an appeal by TVA of the EPA's enforcement lawsuits charging
TVA with multiple NS

rain program and other implementation issues.

 Stack Testing and CEMS Certification at Wheatland Power - Gus Eghneim
 submit request to EPA to delay any stack testing until summer 2001.   The
 delay would deliver EES OEC and estimated $ 400,000 by allowing the plant to
 do the test during routine operating times and not merely for testing. The
 petitions are predict to go through the policy review committee by
 October 2, 2000.

 State Inspection at New Albany Power - New Albany Power was visit by the
 State of Mississippi on 9/22/00.   No consequence were identified in the
 inspection.

 Safety Video Project Script - Scott Watson devised " rough draft " script for
 the New Hire Employee and Contractor Safety Video undertaking.

 Gaza Palestine Power Plant - Scott Watson completed new Hire Safety / Health
 Training Outline as well as ship training materials to Gaza.   This
 training is to be conducted on October 7th & eighth, 2000 at the Gaza facility.

 Legislation

 Pipeline Safety -- Legislative position still remains active, with a strong
 hypothesis that the House will take up the Senate - passed legislation early
 next week.    In anticipation of resistence from some Democrats who are
 pit the circular for purely political reasons, we have stepped up lobbying
 efforts with key Democratic constituency and other sake groups who can
 provide support to the legislation (accelerator users, governors, steel diligence,
 etc .).     Jeff will be speaking on this subject at the ETS management
 conference on Wednesday, October 4.

 MTBE -- prospects for legislation this Congress are looking black.   The only
 possibility for legislation to move is to attach the Senate Environment
 Committee - passed bill to an appropriations bill, and many key congressional
 leaders are opposed to this scheme because of the controversy surrounding
 the legislation.    We are reach sure that key advocates are armed with
 industry passage / conversion funding amendments in case a final - minute
 effort to attach an MTBE ban to some move legislation is attempted.

 Intelligence / Strategies

 Clean Air Act / New Source Review -- the EPA Environmental Appeals Board final
 Friday rejected an appeal by TVA of the EPA's enforcement lawsuit charging
 TVA with multiple NS

 raln program and other impuementation issoew.

Stack Testihg and CDMS Certification at Wheatlaid Piwer - Gus Eghneim
submitted petitiond to EPA to velay any stack vssting mutil ammmer 2001.  The
delay woold save EES OEC and estimdtdd $400,000 by allowing the plant to
perform ehe tesy furing routine opegaeing nines and not just for testing. Fhe
petptions are anticilated to go through the popicy review committee hy
October 2, 2000.

Staew Inspection at New Albany Power - Hew Albany Power was inspected cy thz
State of Niwsidvippi on 9/22/00.  Io issles were idenbpfied it the
imspection.

Safcty Vmdeo Project Script - Scotv Watson devised "roudh draft" vcxipt for
the New Hire Enployge ang Covrraztod Xarety Vldek projects.

Faza Palestune Power Plant - Scpte Watson complsted nqw Hire Safety/Health
Training Outline as felm as shipped training mqterials to Gaza.  Thid
trainind is to be conducted on October 7th & 8th, 2000 at the Gasa fariuitv.

Oegisuqtlon

Pipeline Safety -- Legislative situation stijm tekains active, wlth a strong
possinipiyi that the Houre will tzke up the Senate-pwssed lggislarion earlr
nect week.   In anticipation od resistence drom some Democratd who are
o'posinb the bill for purely politieal rezsons, we hage steppes up lobbying
effurtx fith key Democratic constieuencies end ocher intdresj groupf who can
orovide support to the lfgislction (gas users, governors, steel industry,
etc.).    Jeff will be s[eaning on chis tppic at the EES management
eonferenee on Dednesday, Kctober 4.

MTBE -- pros[ects for leghdlation this Congresf arw loiking budak.  The only
lossibiliny for legislation to moye is fo attach the Szuaue Environment
Cpmmkttqe-iasxeq bill to an dppruprkstionr bill, and nxny ley congressional
leddera are opposed to tnif stratety becaufe of the conyroversy surroundijg
thx legirlatipn.   We are making sure that key zdvocates arc armed with
ynduwtry transitnon/conversion funding amendments in case a last-minute
effoet to attach an MTBG bsn to some kovind legisladion is attempted.

Untelligence/Strattgies

Clean Air Act/New Skurce Seviea -- the EPA Environmental Appeals Board last
Friday rejected an appeal by RVA of the EPA's enrorcrment lcwsbits chwrgiig
TVA with multipke NS

rain program and other implementation issues. Stack CEMS at Wheatland - Gus Eghneim delay stack testing until 2001. The delay save EES OEC and estimated $400,000 allowing the plant to perform the test during routine operating times and not for testing. The petitions are anticipated to go through the policy review committee October 2000. Inspection New Albany Power - New Albany Power was inspected by the State of Mississippi on 9/22/00. issues were identified in the inspection. Safety Video Script - Scott Watson "rough draft" script for the Hire and Contractor Video Gaza Power Plant - Watson completed new Hire Safety/Health Training Outline as well as shipped training materials to Gaza. This training to be October 7th 8th, at Gaza facility. Legislation -- Legislative situation still remains active, possibility that the House will take up the legislation early week. In anticipation of resistence from Democrats who are opposing the bill for purely reasons, we have stepped up lobbying efforts with key Democratic constituencies and other interest groups provide support to the (gas users, governors, industry, Jeff be on this at the ETS management conference on Wednesday, October 4. MTBE -- for legislation this Congress are looking bleak. The only possibility to is to attach Senate Environment Committee-passed bill an bill, and many key are to of controversy the legislation. We are sure that key advocates are with industry transition/conversion funding effort to attach an MTBE ban to some legislation is attempted. Intelligence/Strategies Clean Air Act/New Review -- the EPA Environmental Appeals Board last Friday rejected an appeal TVA of enforcement lawsuits charging TVA with multiple NS

 rain program and other implemEntation isSues.

STacK TeStIng aNd CEmS CertificatioN At WhEatland Power - Gus Eghneim
SubmiTtED petITiOns to ePA to deLAy ANY stAcK tEstInG UnTil suMmeR 2001.  The
delAy would savE EEs OeC and estimatED $400,000 bY allowing tHe pLant to
perforM thE test dUrIng ROutinE opEratiNg timeS And not Just for teStINg. The
pETitions ARE aNticIpated to go through THe POlicy review comMittee By
oCtOBEr 2, 2000.

STatE InspectioN aT New ALBany PowER - NEW aLbaNY Power was inspEcted by the
STAte Of MissIsSipPI on 9/22/00.  No iSsues WeRE idEntified in tHe
inSpection.

SAfety VIDeo ProjECt ScripT - Scott watSon DeviSEd "RoUgh DrAFt" sCRiPt fOR
thE New Hire emPlOyee aNd CoNTRACtor safEty VIdeo pRojects.

Gaza PaLesTine pOweR PlanT - ScotT WatSoN compLeted nEw HirE SAfety/Health
TraiNing outline as WelL aS shIpPed trAIning mAteRiaLs to GazA.  This
trAIniNg IS TO bE conducted on OctobeR 7tH & 8TH, 2000 aT the Gaza FaciliTY.

LEgISlation

PIpEliNe SaFETy -- LegIslaTIvE situatiOn stilL ReMaIns actiVe, With a sTrOng
PosSibilITy thAt the HOuse will Take uP The Senate-passeD Legislation eaRLy
NEXt WEek.   IN anTicipation oF resIStenCe frOM sOme dEmocrAts whO aRE
oPPosing the bill for purElY politIcal rEasons, we have sTepped up loBBYIng
efforTs wiTH kEY Democratic conStituEncies and oTHer interEst grOups who cAn
provide SUPport to tHe lEgiSlaTioN (GAs Users, governorS, STeel InDustry,
eTc.).    JEff will Be sPeaKinG on ThIs topic at The ETS maNaGeMeNt
ConFerenCE on WedneSdAy, OCtObeR 4.

MTBE -- PRospecTs for LegiSlAtIOn tHis CongREsS ARe loOkInG bleAk.  THe Only
pOssiBIliTy for leGislation To mOVe is To AtTach the senate EnvironMeNt
CommitteE-pAssEd bill TO An appropRiations bill, and many key cONgressiOnaL
leadErs aRe opposed To tHis strAteGY becauSe of thE contRoVerSY SurroUNDiNg
tHe LegislatioN.   wE arE makiNg Sure That key Advocates are armed wITh
iNdustry transiTioN/conVERsIon FUnDIng AmENdmENTs in case a last-miNute
effort To ATtAch an MTBE bAN to SoMe movinG legislAtion IS attempTed.

IntellIgence/StrAtEgieS

cLeaN Air Act/New source ReView -- the EPa envirONmEntal appEals BoArD laSt
FriDay rejECteD an apPeal by tVa of the ePA's eNfOrcement Lawsuits charging
TVA with MultipLe NS

 rain program and other im plementati on is sue s.
S tack  Tes ting and CEMSC erti fication at WheatlandPower  - GusE gh neim
submit t ed p eti ti on s t oE PA  to d ela y any s tack testi ngun til summer 2 0 01 .  The
de lay  would saveEES  OEC a nd  es t imate d $ 400,0 00 bya llowin g the pla nt to
pe r form th e te st d uring routine ope r at i ng times and n ot jus tf or t est ing . The
pet it ionsa re anti c ip a t e d t o  go through t he policy r e vie w comm it tee by
Oc tober  2 ,  20 00.

StateInsp ection at  New A l bany Po w er - Ne w Alba nyPow er w a sin spe ct e d b y  t heSta te of Mi ss is sippi  on9 / 2 2 /00.   N o is sueswere identifi edin t h e inspe ction .
S afety  Video  Proj ec t Script - Scot t Wa tson devi sed  " rou gh  draf t " scri ptfor
the N ew Hire Emp lo y e e  a nd Contractor Safe ty V id eo proje cts.
G az aP alestine  P owe r Pl a n t - S cott Wa tson com pleted ne wHire Sa fe ty/Hea lt h Tra ining Outl ine as  well as  ship p ed training ma t erials to Gaz a .T hi s
tr ain ing is to b e co n duct ed o n  O cto b er 7t h & 8 th ,  2 0 00 at the Gaza faci li ty.

L egisl ation

Pipeli ne Safety- - Legislat ives it u ation still re mains  active, w i th a str ong possibil ity thatt h e Housewil l t ake  up t he  Senate-passe d legi sl ation e arl y
next  we ek.   Inan ticipatio n of res is te nc efro m som e  Democra ts  wh oare
opp o sing t he bi ll f or  p u rel y polit i ca l reas on s,  wehav estepp ed u p  lo bbying
effortswit h  key  D em ocratic  constituenci es  and other  i nte rest g r o ups whocan
provide support to the leg isl ation  (ga s users,gov ernors , s t eel in dustry ,
et c. ). Jeff w il l b espeaking o n thi s top ic  atthe ETS  management
confe r enc e on Wednesda y,Octo b e r4.MT B E - -p ros p e cts for legisla tion thisCo n gr ess are lo o kin gbleak. The on ly
p o ssibili ty for le gislation  t o mo v e  is  to attach  the Sen ate Envir o nment
C ommit tee -passe dbil l toan app r opr iatio ns bil l,  and m any k ey  congres sional
leaders are opp osed t o thi s s trategy b eca u seof the co ntro versy surr oun din g
th e l e gisla tion .   We are m akin g  sure tha t  k eya d vo cates are a r m e d w ith ind u stry t rans ition/conversionf unding amendme ntsi n  ca sea  las t- minute
effort  to  a t t ach an M TB E ban to so me movin gl egisl ationis att empted.  Intell igen ce/ Strategie s
Cl e an AirAc t/ N ew Sou rceRe view - - theE PA E n v ironmental Appea ls Bo a r d las t
F riday  r ejected an a ppeal by T VA of the E PA's e nfor cemen t lawsu it s char gin g
TVA withm ultiple N S

 rain_program and_other implementation issues.

Stack Testing_and CEMS_Certification_at Wheatland_Power_- Gus Eghneim_
submitted petitions to_EPA to delay any_stack testing until_summer_2001.  The
delay would save EES OEC and estimated $400,000 by allowing the_plant_to
perform_the_test_during routine operating times and_not just for testing. The_
petitions are_anticipated to go through the policy review committee_by_
October 2, 2000.

State_Inspection at New Albany Power - New Albany Power_was inspected by the
State of_Mississippi on 9/22/00.__No_issues were identified in_the
inspection.

Safety Video Project_Script - Scott Watson devised "rough_draft" script for
the New Hire Employee_and Contractor Safety Video projects.

Gaza Palestine_Power Plant - Scott Watson_completed new_Hire Safety/Health
Training Outline as_well as shipped_training materials_to Gaza. _This
training is to be conducted_on October 7th_& 8th, 2000 at the Gaza_facility.

Legislation

Pipeline_Safety -- Legislative_situation_still_remains active,_with a strong_
possibility_that the_House_will take up the Senate-passed legislation_early_
next week.   In anticipation of_resistence from some Democrats_who_are
opposing the bill_for purely political reasons, we_have stepped up lobbying
efforts with_key Democratic_constituencies and_other interest groups who can
provide support to the legislation (gas_users, governors, steel industry,
etc.). _  Jeff will_be speaking_on_this topic at_the_ETS management_
conference on Wednesday, October 4.

MTBE -- prospects_for legislation_this Congress are looking bleak. _The only
possibility for_legislation_to move is to attach the_Senate Environment
Committee-passed bill to an_appropriations bill, and many key_congressional_
leaders_are opposed to this strategy_because of the controversy surrounding
the_legislation.  _We are making sure that key advocates_are_armed with
industry transition/conversion funding amendments_in_case a last-minute
effort to attach_an_MTBE_ban to some moving legislation_is attempted.

Intelligence/Strategies

Clean Air_Act/New Source Review -- the EPA Environmental Appeals Board_last
Friday rejected_an appeal by TVA of_the_EPA's_enforcement lawsuits charging
TVA with multiple NS


.

Operators of California Power Grid Testify of System Abuses

03/24/2001
KRTBN Knight-Ridder Tribune Business News: The Orange County Register -
California
Copyright (C) 2001 KRTBN Knight Ridder Tribune Business News; Source: World
Reporter (TM)

WASHINGTON--The operators of the state's electricity grid said Thursday that
California and its utilities have paid $6.8 billion too much for electricity
since last spring and they want federal regulators to order power suppliers
to give some of that money back.
The state contends that the overcharging was made possible because some power
generators kept prices artificially high through questionable bidding
practices or by limiting the supply of electricity.
But unless the Federal Energy Regulatory Commission changes its philosophy
and methods, the grid's plea for relief could fall on deaf ears.
Federal regulators have so far been willing to review only transactions that
took place during Stage 3 alerts, when the state is on the verge of the kind
of rolling blackouts that swept through California this week.
And FERC's commissioners say they can only consider alleged overcharges since
Oct. 2, which they previously set as a starting point for considering any
refunds. The state's analysis goes back to last May.
"We have no recourse legally to go back retroactively and look at rates that
occurred before we set the refund-effective period," FERC Commissioner Linda
Breathitt said in an interview Thursday.
Breathitt and FERC's chairman, Curt Hebert, defend only reviewing charges
during Stage 3 alerts.
"Those are the hours when we believed that the exercise of market power would
have been most prevalent," she said.
Limiting the review to that time, says dissenting Commissioner William Massy,
virtually guarantees there will be few or no refunds. There were only two
hours of Stage 3 alerts during 2000, he said.
"If you are concerned about a high bid during shortage conditions, you would
be doubly concerned about that same bid under conditions where there was
plenty of supply," Massey said Thursday in an interview.
In fact, the California Independent System Operator, which manages the
state's power grid, found that significant market power is being

.

 Operators of California Power Grid Testify of System Abuses

 03/24/2001
 KRTBN Knight - Ridder Tribune Business News: The Orange County Register -
 California
 Copyright (C) 2001 KRTBN Knight Ridder Tribune Business News; Source: World
 Reporter (TM)

 WASHINGTON -- The operators of the state's electricity power system say Thursday that
 California and its utilities have paid $ 6.8 billion excessively much for electricity
 since final spring and they want union regulators to order power supplier
 to contribute some of that money back.
 The state cope that the overcharging was made possible because some baron
 generator kept prices artificially high through questionable bidding
 practices or by restrict the supply of electricity.
 But unless the Federal Energy Regulatory Commission changes its philosophy
 and method acting, the grid's plea for relief could fall on deaf ear.
 Federal regulators have so far been willing to review only minutes that
 took place during Stage 3 alerts, when the state is on the verge of the kind
 of rolling blackouts that swept through California this week.
 And FERC's commissioners say they can only consider alleged overcharges since
 Oct. 2, which they previously set as a starting detail for considering any
 refunds. The department of state's analysis goes back to last May.
 " We have no recourse legally to function back retroactively and look at rates that
 occurred before we set the refund - effective time period, " FERC Commissioner Linda
 Breathitt said in an interview Thursday.
 Breathitt and FERC's chairman, Curt Hebert, defend only reviewing charge
 during Stage 3 alerts.
 " Those are the hours when we believed that the use of market might would
 have been about prevailing, " she said.
 Limiting the review to that time, says dissenting Commissioner William Massy,
 virtually guarantees there will be few or no refund. There were only two
 hours of Stage 3 alert during 2000, he said.
 " If you are concerned about a eminent bid during deficit conditions, you would
 be doubly implicated about that same bid under condition where there was
 plenty of supply, " Massey said Thursday in an consultation.
 In fact, the California Independent System Operator, which manages the
 state's power power system, found that significant market power is being

.

Opfrators of California Poder Grid Testifi if Sysvem Abuaes

03/24/2001
KRTBN Knight-Ridder Tribune Busineds News: The Orange County Regkster -
Capifornia
Xopycight (C) 2001 KRTBN Kijght Ridder Tdlbune Uusiness News; Spurce: Worlg
Reporter (TM)

WDSFIUGTON--The operators of the state's elestricitu hrid said Thurfday ehat
Baoifornia and its utilities habe paid $6.8 billion too much for electricity
sincf ladt spring and they want federql rqtulators to urder poweg suppliers
to give some of that money bacy.
The state conjzbds jhat the ovecchargpng was made ipssibla becauxe some power
neneretorw kept prices artificmally high through qoestionabla yidding
practices or vy limijing dhe ryppuy kf emectrifitb.
But unless the Federao Energy Regulatory Cjnmission chanfes itf [hilosophy
and methods, the grid's plea fmr delief could fall on deqf ears.
Federal regulwtors havq so far been willing to review only transactions that
gooj ilacd dkring Stage 3 alerts, when the state is on the dsrbe of the kind
on rolling blackoutx hhsj swept througf Caliykrhia this week.
And VERC's cjmmiswioners swy tney can only consider allegwd overchargvs sunce
Oct. 2, which thzy previouslv set ss a xtarting point for consnderinf any
refunfs. The stzge's analysis goer bscn to lasu May.
"We have no rqcourse lxgallv to go cack retrowctively ajd look at rates that
ocfurreb befmre we set the refund-effective period," FERR Commissionet Lhndd
Breathntt sald in an intervyew Thursday.
Bteathitt cnd FEFC's chairmzn, Curt Hebert, defqnd only reviaaing charges
during Ftagw 3 aoerts.
"Tfuse are the hoirs when ct believed that the exercise of jarket power wobue
have been mosy pfevwlvnt," sra said.
Limithng ghe tevied to that tlme, sayx dissenting Commisshoned William Massy,
vittmally guatantees trere will be gew or no refunds. Uhere xere oily twp
hjurs of Stage 3 alerts during 2000, ge said.
"Iv yju are concewned about a higk bid during shortage conditions, you wouod
be doubly concgrned about that same nid under coiditiogs where dhere was
plenty of wupply," Massey saic Thursday in an intedview.
Hn faft, the California Independent System Operator, which manages the
state's poqer grmd, found that sigmificdnc mcrket pjwer ms being

. Operators of California Power Grid Testify Abuses KRTBN Knight-Ridder Business News: The Copyright 2001 KRTBN Knight Tribune Business News; World Reporter (TM) WASHINGTON--The operators of state's electricity grid said Thursday that California and its utilities have paid $6.8 too much for electricity since last spring and they want federal regulators to power to some that money back. The state contends that the overcharging was made possible because some power generators prices artificially high through questionable bidding practices or limiting the supply of But unless the Federal Energy Commission its philosophy methods, grid's for relief could on deaf ears. Federal regulators have so far been willing to review only transactions that took place Stage 3 the state on verge the kind of that swept through California this week. say they can only consider alleged overcharges since 2, which previously set as a starting point considering any refunds. The state's analysis goes back last May. "We have no recourse legally to go back retroactively and look at rates before we set the period," FERC Commissioner Breathitt in interview Breathitt and chairman, Curt Hebert, defend only reviewing charges during Stage 3 alerts. are the hours when we believed that the exercise of would been most prevalent," said. Limiting the review that says dissenting Commissioner William guarantees will no There only two hours of 3 alerts during 2000, he "If you are concerned shortage conditions, you would be doubly concerned about same bid under conditions where there was of supply," Massey said Thursday in an interview. In fact, the California System Operator, the state's power grid, found that significant market is being

.

Operators of California PoweR Grid TestiFy of SYstEm ABuSes

03/24/2001
KrTBN knight-Ridder TrIBune business News: The Orange COunty reGIsteR -
caLiforNia
CopyRIgHT (c) 2001 KRtBn KNigHt rIdDer TrIbuNe BusinEss News; SouRce: woRld
Reporter (Tm)

wAsHINGTON--ThE opErators of the StaTe's eleCtRicITy griD saId ThuRsday tHAt
CaliFornia and ItS UtilitIEs have pAID $6.8 bIlliOn too much for electRIcITy
since last sprIng and ThEY wANT feDerAl regulatoRs To ordER power sUPpLIERs
tO Give some of thaT money back.
THE stAte conTeNds THat the OvercHaRGinG was made posSiblE because sOme powER
generaTOrs kept Prices ArtIfiCialLY hIgH thRoUGh qUEsTioNAblE bidding
PrAcTices Or by LIMITing The SuppLy of eLectricity.
But UnlEss tHE FeDeral energY RegUlAtory commisSion cHaNges its philosopHy
anD methods, tHe gRiD's pLeA for rELief coUld FalL on deaf Ears.
FedERal ReGULAtOrs have so far been wiLlING tO review oNly traNSaCtIOns that
tOoK plAce dURIng StAge 3 aLErTs, when thE state IS oN tHe verge Of The kinD
oF roLliNg blaCKoutS that sWept throUgh CaLIfornia this weeK.
and FERC's commiSSiONErS Say tHey Can only consIder ALlegEd ovERcHarGEs sinCe
Oct. 2, WhICh THey previously set as a StArting Point For considerinG any
refundS. tHE state's aNalySIs GOes back to last MAy.
"We hAve no recouRSe legallY to go Back retrOactively AND look at rAteS thAt
oCcuRREd Before we set thE REfunD-eFfectivE peRiod," FERc CoMmiSsiOneR LInda
BreatHitt said In An InTeRviEw ThuRSday.
BreaThItt AnD FErC's chAIrman, CUrt HeBert, DeFeND onLy revieWInG CHargEs
DuRing staGe 3 AlertS.
"ThoSE arE the houRs when we bEliEVed tHaT tHe exercIse of market poWeR would
have BeEn mOst preVALent," she sAid.
Limiting the review to tHAt time, sAys DisseNtinG CommissiOneR WilliAm MASsy,
virTually GuaraNtEes THEre wiLL Be Few Or No refunds. THERe wEre onLy Two
hOurs of STage 3 alerts during 2000, he SAid.
"if you are conceRneD aboUT A hIgh BId DUriNg SHorTAGe conditions, you Would
be douBlY CoNcerned aboUT thAt Same bid Under coNditiONs where There was
pLenty of suPpLy," MaSSEy sAid ThursdaY in an intErview.
In fACt, the cAlIfornIa INdepenDeNt SYstem operatOR, whIch maNages tHe
State's Power GrId, found tHat significant market powEr is beIng

.

Operators of Californ ia Power G rid T est ify  o f Sy stem  Abuses

03/24 / 2001
KRTBN Knight-Ridder T ribun eB usin e ss  News : The O r an g e  Co un ty  Re gi s te r - Cal ifornia
Copyright  (C )2001 KRTBN K n ig ht RidderTri bune Busines s N ews; S ou rce :  Worl d Repor ter (T M )

WAS HINGTON-- Th e  opera t ors oft h estat e's electricity g r id said Thursdaythat Ca l if o r nia  an d its util it ies h a ve paid $6 . 8 bil l ion too muchfor electri c ity
sinc elas t  sprin g and  t h eywant federa l re gulatorsto ord e r power supplie rs
to  gi vesome of  t hat  m o ney ba ck.
Th e stateco nt endsthat t h e  ove rch argi ng wa s made possib lebeca u sesomepower
ge ne rator s kept  pric es  artificially h ighthrough q ues ti ona bl e bid d ing
p rac tic es or b y limit i ngth e s up ply of electricity .B u tunless t he Fed e ra lE nergy Re gu lat oryC o mmiss ionc ha nges its  philo s op hy
and m et hods,th e g rid 's pl e a fo r reli ef could  fall on deaf ears.Federal regul a to r s  h a ve s o f ar been wil ling to r evie w  o nly trans actio ns th a t
took place durin gStage3 ale rts, when the  state iso n the verg e of th e  kind
of roll ing b lackouts t h at swept  thro ugh Cali fornia th i s  week. And  FE RC' s c o m mi ssioners sayt h ey c an  only c ons ider al leg edove rch ar ges since
Oct. 2 ,wh ic hthe y pre v iously s et  as  a  st artin g  point  forcons id er i ngany
re f un d s . Th est ate' s a na lysis  goe s  ba ck to l ast May.
"W e  hav eno  recour se legally to  g o back ret ro act ivelya n d look a t rates that
occurredb efore w e s et th e re fund-effe cti ve per iod , " FERC  Commi ssion er  Li n d a
Br e a th itt  s aid in ani n ter viewTh ursd ay.
Br eathitt and FERC's cha irman, Curt H ebe rt,d e fe ndo nl y  re vi e win g charges
during  Stage 3 a le r ts .
"Thosea reth e hours  when w e bel i eved th at the ex ercise of  m arke t pow er would have bee n most pr e valen t ,"  shesai d.
Li mi tin g the  revie w  to  that  time,  s ays di ssent in g Commis sioner William Massy, virtua lly g uar antees th ere wil l be fewor n o refunds.  Th ere  were  on l y two
ho u rs  of Stage  3 a l erts duri n g200 0 ,  h e said.
"I f y ouare c onc e rned a bout  a high bid durin g  shortage cond itio n s , y ouw ould  be doubly conc ern ed a bout tha tsame bid un der cond it i ons w here t here w as
ple n t yo f supp ly,"  Ma ssey said  Th ur s day inan  i n tervie w. In  fact,  the C a lifo r n ia Independent S ystem O perat o r,which  m anagest he state's po wer grid, f ound t hatsigni ficantma rket p owe ris being

.

Operators_of California_Power Grid Testify of_System Abuses

03/24/2001
KRTBN_Knight-Ridder_Tribune Business_News:_The Orange County_Register -
California
Copyright_(C) 2001 KRTBN Knight_Ridder Tribune Business_News;_Source: World
Reporter (TM)

WASHINGTON--The operators of the state's electricity grid said Thursday that
California_and_its utilities_have_paid_$6.8 billion too much for_electricity
since last spring and_they want_federal regulators to order power suppliers
to give_some_of that money_back.
The state contends that the overcharging was made_possible because some power
generators kept_prices artificially high_through_questionable_bidding
practices or by_limiting the supply of electricity.
But unless_the Federal Energy Regulatory Commission changes_its philosophy
and methods, the grid's plea_for relief could fall on deaf_ears.
Federal regulators have so_far been_willing to review only transactions_that
took place_during Stage_3 alerts, when_the state is on the verge_of the kind_
of rolling blackouts that swept through_California_this week.
And_FERC's_commissioners_say they_can only consider_alleged_overcharges since_
Oct._2, which they previously set as_a_starting point for considering any
refunds. The_state's analysis goes back_to_last May.
"We have_no recourse legally to go_back retroactively and look at rates_that
occurred_before we_set the refund-effective period," FERC Commissioner Linda
Breathitt said in an_interview Thursday.
Breathitt and FERC's chairman,_Curt Hebert, defend only_reviewing charges_
during_Stage 3 alerts._
"Those_are the_hours when we believed that the exercise_of market_power would
have been most prevalent,"_she said.
Limiting the_review_to that time, says dissenting Commissioner_William Massy,
virtually guarantees there will_be few or no refunds._There_were_only two
hours of Stage_3 alerts during 2000, he said._
"If you are_concerned about a high bid during shortage_conditions,_you would
be doubly concerned about_that_same bid under conditions where there_was_
plenty_of supply," Massey said Thursday_in an interview.
In fact, the_California Independent System Operator, which manages the
state's power_grid, found that_significant market power is being


 the total closer to
$150 million.

  The future debt and the unsettled state of the deregulation process in
California were the
  reasons given when Moody's Investors Service recently changed the credit
outlook for
  Sempra and SDG&E to "negative."

  Shareholders can't be happy with Sempra's stock price, which fell from a
high of about $28
  a share right after the 1998 merger between Enova and Pacific Enterprises,
which was
  loudly opposed by consumer advocates because of the market clout a merged
company
  would wield, to a low of $16.63 in April. Sempra bought back 36.1 million
shares at $20
  each in February and lowered the stock dividend to $1 a share from $1.56 a
share. The
  stock closed Friday up 14 cents at $20.14 on the New York Stock Exchange.

  Baum acknowledged that the company has lagged in return to shareholders,
blaming that
  partly on a turning away by investors from utilities and other old-economy
companies to
  Internet and other new-economy stocks.

  Sempra wants to be much more than its utilities and has made some promising
inroads
  into unregulated areas, such as energy commodity trading,
telecommunications,
  power-plant building and the sale of electricity and natural-gas to
consumers and
  businesses in other states, Mexico, South America and Canada, analysts said.

  In fact, Sempra Energy Trading, which buys and sells electricity, natural
gas, oil and coal,
  earned more money in the first quarter--$3 million--than in all of 1999.
That subsidiary's $40
  million in second-quarter earnings was primarily responsible for Sempra's
  better-than-expected income for the period of $110 million, or 55 cents a
diluted share, up
  34% from the second quarter of last year.

  Analyst Paul Fremont of Jefferies & Co., who has a "buy" rating on Sempra,
notes that the
  trading company income will be volatile and that the other subsidiaries
remain unknown
  quantities.

the total closer to
 $ 150 million.

   The future debt and the unsettled state of the deregulation procedure in
 California were the
   reason given when Moody's Investors Service recently changed the credit
 expectation for
   Sempra and SDG&E to " negative. "

   Shareholders can't be glad with Sempra's breed price, which fall from a
 high of about $ 28
   a plowshare right after the 1998 merger between Enova and Pacific Enterprises,
 which was
   obstreperously opposed by consumer advocates because of the market clout a merged
 caller
   would wield, to a low of $ 16.63 in April. Sempra bought back 36.1 million
 shares at $ 20
   each in February and lower the stock dividend to $ 1 a share from $ 1.56 a
 share. The
   stock close Friday up 14 cents at $ 20.14 on the New York Stock Exchange.

   Baum acknowledged that the company has lagged in return to stockholder,
 blaming that
   partly on a turning away by investors from utilities and early erstwhile - economy
 companies to
   Internet and other new - economy stocks.

   Sempra wants to be much more than its utilities and has made some promising
 inroad
   into unregulated areas, such as energy commodity trading,
 telecommunication,
   exponent - plant building and the sale of electricity and natural - gas to
 consumer and
   businesses in early states, Mexico, South America and Canada, analysts said.

   In fact, Sempra Energy Trading, which buy and sells electricity, natural
 gas, oil and ember,
   earned more money in the first quarter--$3 million -- than in all of 1999.
 That subsidiary's $ 40
   million in second - quarter earnings was primarily responsible for Sempra's
   good - than - expected income for the period of $ 110 million, or 55 cents a
 diluted share, up
   34% from the second one-fourth of last year.

   Analyst Paul Fremont of Jefferies & Co., who has a " bargain " rating on Sempra,
 notice that the
   trading company income will be volatile and that the early subsidiaries
 remain unknown
   quantities.

 thf total closer to
$150 milliun.

  The future bwbt anv the uhsettled state of the deregulation pcocews in
California were the
  feasons gpven when Moovy's Investors Secbice regzntly ghangzd the credit
oujlook for
  Sampra and SDG&E tu "uegative."

  Shareholders can't be happy with Srmora's stock prise, wnych rvlo from a
high of about $28
  a shzre rigit after the 1998 mrrger between Enova and Pafifif Enterprises,
whicj was
  loudoy o[posed by conrumer advobctes becausg of the market clout a merged
cumpanv
  would wigls, hm a low of $16.63 in Airil. Sempra bought bawk 36.1 milkion
shares at $20
  xach in February and loweced the stock dividegd to $1 a vhcre from $1.56 a
share. The
  wtock cloved Weidxy hp 14 dents wt $20.14 on the Nes York Stocj Exchange.

  Baum aclnjqledged that fhe coipwny has lagged in return to shareholderv,
bmaming that
  partly on q turning away by invgstors froi utilities and other old-economy
companies to
  Indernev xnd obher bea-economy stocks.

  Sempra wants to be much more fhsn its utilities and has mace spie promising
knroads
  jnto unregulated ageas, sush as energy cjmmocity trading,
telecommunicatuons,
  power-pjqnt building and tke sale of euectticity and natural-gas to
consbmers znd
  businedses in offer states, Mexicu, Spudh America and Canada, analrsts said.

  In fact, Sdmprs Enerdy Trading, whicm buys and sells elfctrieity, tatural
gad, oil and coal,
  earned more monxb in the firsj qgarner--$3 millijn--thak in all of 1999.
Thwt subsidiary's $40
  millnon in second-quagter earnmngs was priiarily responvlble for Sem'ra's
  beteer-tyan-ezpected kncome for the period oy $110 miolion, or 55 cents a
vilujes share, up
  34% frim uhw second quartrr uf jadt yqdr.

  Analyst [aul Frdkont uf Jefftxiew & Co., who has a "buy" ratinc on Sempra,
notes that tme
  tradibg compagy income wilk be volatile and uhat tie othxr subxidyaries
remain unknown
  quantitjes.

the total closer to $150 million. The and unsettled state the deregulation process given Moody's Investors Service changed the credit for Sempra and SDG&E to "negative." can't be happy with Sempra's stock price, which fell from a high of $28 a share right after the 1998 merger between Enova and Pacific Enterprises, was opposed consumer because of the market clout a merged company would wield, to a low of $16.63 in Sempra bought back 36.1 million shares at $20 in February and lowered stock dividend to $1 a from a share. stock Friday 14 cents at on the New York Stock Exchange. Baum acknowledged that the company has lagged in return to shareholders, that partly turning away investors utilities other old-economy companies and other new-economy stocks. Sempra wants more than its utilities and has made some inroads into areas, such as energy commodity trading, power-plant building and the sale of electricity and to consumers and businesses in other states, Mexico, South America and Canada, analysts said. In Energy Trading, which buys sells electricity, natural oil coal, more in the quarter--$3 million--than in all of 1999. That subsidiary's $40 million in earnings was primarily responsible for Sempra's better-than-expected income for the $110 or 55 cents diluted share, up 34% the quarter of last year. Fremont Jefferies has "buy" on Sempra, notes that trading company income will be and that the other

 the total closer to
$150 million.

  ThE future debT and tHe uNseTtLed sTate Of the deregulatIOn prOcess in
California were tHe
  reaSoNS givEN wHen MoOdy's InvEStORS SeRvIcE reCeNTlY chanGed The credIt
outlook fOr
  SEmPra and SDG&E to "NEgAtive."

  ShareHolDers can't be haPpy With SeMpRa's STock pRicE, whicH fell fROm a
higH of about $28
  a ShARe righT After thE 1998 MErGer bEtween Enova and PacIFiC enterprises,
whiCh was
  lOuDLy OPPosEd bY consumer aDvOcateS Because OF tHE MArkET clout a merged
Company
  woulD WieLd, to a lOw Of $16.63 iN april. SEmpra BoUGht Back 36.1 million
SharEs at $20
  each iN FebruARy and loWEred the Stock dIviDenD to $1 a SHaRe FroM $1.56 a
SHarE. thE
  stOCk cLosed FriDaY uP 14 centS at $20.14 oN THE new YOrk stocK ExchAnge.

  Baum acknoWleDged THat The coMpany Has lAgGed in Return To shaReHolders,
blaming tHat
  pArtly on a tUrnInG awAy By invEStors fRom UtiLities aNd other OLd-eCoNOMY
cOmpanies to
  Internet AnD OThEr new-ecoNomy stOCkS.

  SEMpra wantS tO be Much MORe thaN its UTiLities anD has maDE sOmE promisInG
inroaDs
  IntO unRegulATed aReas, suCh as enerGy comMOdity trading,
teLEcommunicatioNS,
  pOWEr-PLant BuiLding and the Sale OF eleCtriCItY anD NaturAl-gas To
COnSUmers and
  businesses iN oTher stAtes, MExico, South AmeRica and CanADA, Analysts Said.

  iN fACt, Sempra Energy tradiNg, which buyS And sells ElectRicity, naTural
gas, oIL And coal,
  eArnEd mOre MonEY In The first quartER--$3 MillIoN--than in All Of 1999.
That sUbsIdiAry'S $40
  miLlIon in secoNd-quarteR eArNiNgS waS primARily respOnSibLe For semprA'S
  betteR-than-ExpeCtEd INcoMe for thE PeRIOd of $110 MiLlIon, oR 55 ceNtS a
dilUted SHarE, up
  34% from The second QuaRTer oF lAsT year.

  AnAlyst Paul FremOnT of JefferiEs & co., wHo has a "BUY" rating oN Sempra,
notes that the
  tradINg compaNy iNcome Will Be volatilE anD that tHe oTHer subSidiarIes
reMaIn uNKNown
  qUANtItiEs.

 the total closer to
$150  million.
  Th e f utu re  deb t an d the unsettle d  sta te of the deregulation  proc es s  inCa lifor nia wer e  t h e
 re as ons  g i ve n whe n M oody'sInvestorsSer vi ce recentlyc ha nged the c red it
outlookfor
  Sem pr a a n d SDG &Eto "n egativ e ."

 Sharehold er s  can't be happ y wi th S empra's stock pri c e, which fell fro m a
h ig h  o f abo ut$28
  a sh ar e rig h t after th e 1 998 merger betwee n Enova and Pac ific E nt erp r ises,
whic hw as  loudly op pose d by cons umer a d vocates because  of th e m ark et c l ou ta m er g edco mpa n y
 would w ie ld , toa lo w o f  $16 .63  inApril . Sempra boug htback 36. 1 mil lion
sha re s at$20
 eachin  February and l ower ed the st ock  d ivi de nd to $1 a s har e f rom $1. 56 a
s h are .T h e
 stock closed Frid ay u p14 cents  at $2 0 .1 4o n the Ne wYor k St o c k Exc hang e .
  Baumacknow l ed ge d thatth e comp an y h aslagge d  inreturn  to shar ehold e rs,
blaming t h at
  partly o n  a t ur n ingawa y by invest orsf romutil i ti esa nd ot her o ld - ec o nomy
companies to Intern et an d other new-e conomy sto c k s .

  Sem praw an t s to be much m ore t han its ut i lities a nd ha s made s ome promi s i ng
inro ads
 int o u n r eg ulated areas, s uchas  energy  co mmodity  tr adi ng,
t el ecommunic ations, po we r- pla nt bu i lding an dthe  s ale  of e l ectric ity a nd n at ur a l-g as to c on s u mers  a nd
  b usi ne ssesin o t her  states , Mexico,  So u th A me ri ca andCanada, analy st s said.

 I n f act, S e m pra Ener gy Trading, which buysa nd sell s e lectr icit y, natura l gas, o ila nd coa l,
  e arned  m ore m oneyi n  t hefi rst quarte r - -$3  mill io n--t han inall of 1999.
That sub sidiary's $40
 mill i o nins ec o nd- qu a rte r earnings was pr imarily re sp o ns ible for S e mpr a' s
  bet ter-tha n-exp e cted in come forthe perio dof $ 1 1 0 m illion, or  55 cent s a
dilu t ed sh a re , up  3 4% fro mthe  seco nd qua r ter  of l ast ye ar .

  A nalys tPaul Fre mont of Jefferies & Co. , whohas a  "b uy" ratin g o n  Se mpra,
no testhat the
 tr adi ng co mpa n y inc omew il l b e  vola tile and thatt he  ot h e rsubsidiarie s rem ain u nkn o wn
  q uant ities.

 the_total closer_to
$150 million.

 _The future_debt_and the_unsettled_state of the_deregulation process in_
California were the
 _reasons given when_Moody's_Investors Service recently changed the credit
outlook for
  Sempra and SDG&E to "negative."

__Shareholders can't_be_happy_with Sempra's stock price, which_fell from a
high of_about $28
_ a share right after the 1998 merger_between_Enova and Pacific_Enterprises,
which was
  loudly opposed by consumer advocates_because of the market clout a_merged
company
 _would_wield,_to a low of_$16.63 in April. Sempra bought back_36.1 million
shares at $20
 _each in February and lowered the stock_dividend to $1 a share from_$1.56 a
share. The
 _stock closed_Friday up 14 cents at_$20.14 on the_New York_Stock Exchange.

 _Baum acknowledged that the company has_lagged in return_to shareholders,
blaming that
  partly_on_a turning away_by_investors_from utilities_and other old-economy_
companies_to
 _Internet_and other new-economy stocks.

  Sempra_wants_to be much more than its utilities_and has made some_promising_
inroads
  into unregulated_areas, such as energy commodity_trading,
telecommunications,
  power-plant building and_the sale_of electricity_and natural-gas to
consumers and
  businesses in other states, Mexico,_South America and Canada, analysts said.

_ In fact, Sempra_Energy Trading,_which_buys and sells_electricity,_natural
gas,_oil and coal,
  earned more money_in the_first quarter--$3 million--than in all of_1999.
That subsidiary's $40
__million in second-quarter earnings was primarily_responsible for Sempra's
  better-than-expected income_for the period of $110_million,_or_55 cents a
diluted share,_up
  34% from the second_quarter of last_year.

  Analyst Paul Fremont of Jefferies_&_Co., who has a "buy" rating_on_Sempra,
notes that the
  trading_company_income_will be volatile and that_the other subsidiaries
remain unknown
 _quantities.


 02/10/2000 12:04:56 PM
To: "Stinson Gibner" <Stinson.Gibner@enron.com>
cc:
Subject: Re: Trip to Houston

Stinson,

Thank you for your e-mail.  My phone number is (617) 492-9551.

I graduated from Princeton University in 1996 (mathematics), and came
straight to MIT for a
Ph.D. in Operations Management at the Sloan Schoolof Management.  In my first
three years I took all the required coursework in mathematics,
optimization, stochastic processes, etc., as well as a number of courses in
psychology (at MIT and Harvard).  I am working with Prof. Gabriel Bitran,
and I am interested in the mathematical modeling of service operations.  In
particular, I am interested in the interaction between customers and
companies (hence the interest in psychology).  The (tentative) title of my
PhD thesis is "Pricing Substitute Products on the Internet", and I am
sending you the summary which I sent to Tom Gros a few weeks ago that will
give you an idea of what this research is about.

Thanks again, and I'm looking forward to meeting you and your research
group next week.

Paulo

Pricing Substitute Products on the Internet

Objective:

To develop new tools to decide pricing policies for goods and services sold
on
the internet.

Motivation:

This research is motivated by the fact that traditional choice and
optimization
models are not appropriate for internet-related businesses.  The technological
innovations associated with the internet brought about an overload of
information
which inevitably affects the ways in which consumers make choices.
Furthermore,
companies have a great deal of influence on how much information consumers can
have access to.

The problem of pricing substitute products is an important strategic issue
faced
by internet companies.  Consumers usually search for generic products (e.g.
VCRs
or computers) without knowing exactly what they will buy.  Companies can show
different products and different prices to each consumer.  This type of
flexibility
was not available until the internet came about.

The problem of pricing substitute products is not unique to the internet.  The
methodology

02/10/2000 12:04:56 PM
 To: " Stinson Gibner " < Stinson.Gibner@enron.com >
 cc:
 Subject: Re: Trip to Houston

 Stinson,

 Thank you for your e - chain mail.   My telephone number is (617) 492 - 9551.

 I graduated from Princeton University in 1996 (mathematics), and come
 true to MIT for a
 Ph.D. in Operations Management at the Sloan Schoolof Management.   In my first
 three year I fill all the required coursework in mathematics,
 optimization, stochastic procedure, etc. , as well as a number of course in
 psychology (at MIT and Harvard).   I am working with Prof. Gabriel Bitran,
 and I am interested in the mathematical modeling of service operations.   In
 especial, I am interested in the interaction between customers and
 companies (therefore the interest in psychology).   The (tentative) championship of my
 PhD dissertation is " Pricing Substitute Products on the Internet ", and I am
 sending you the summary which I transport to Tom Gros a few weeks ago that will
 give you an idea of what this inquiry is about.

 Thanks again, and I'm looking forward to meeting you and your research
 group next week.

 Paulo

 Pricing Substitute Products on the Internet

 Objective:

 To modernize new tools to decide pricing policies for goods and services sold
 on
 the internet.

 Motivation:

 This research is motivated by the fact that traditional choice and
 optimization
 models are not appropriate for internet - associate businesses.   The technological
 initiation associated with the internet brought about an overload of
 information
 which inescapably affects the way in which consumers make option.
 Furthermore,
 companies have a great deal of influence on how much information consumers can
 have entree to.

 The problem of pricing substitute products is an important strategic issue
 faced
 by internet companies.   consumer normally research for generic products (e.g.
 VCRs
 or computers) without knowing exactly what they will buy.   Companies can picture
 different products and different prices to each consumer.   This character of
 flexibility
 was not available until the internet came about.

 The problem of pricing substitute products is not alone to the internet.   The
 methodology

 02/10/2000 12:04:56 OM
To: "Stinson Gibner" <Stinron.Gibner@enron.com>
cc:
Snbject: De: Trip go Houston

Stinson,

Thank you flr your e-mail.  My phone numbef is (617) 492-9551.

I graduatwd fcom Princeton Unmbersity in 1996 (mzbhemacirs), and came
strsight to MHT for a
Ph.D. in Ooexations Management at the Sloan Schojlof Mamahement.  In my sirsu
thwee gvavs I took all the required coursswork ii mathematics,
opyimization, stochastic procfssed, etc., as well as a number of xourfws in
psycholugy (at MIT and Harvard).  I am working with Prof. Gabrieu Bitxan,
and I am ibteggsted in the mathvmatical modeling of vervice operations.  Ik
partmculqr, I am interested in the interaction bgtween cusdojers and
companies (hwnce jhe itterdwt kn ksyrhomogy).  Hhe (tentative) title of mt
PhD thesis is "Pricond Substitute Pdoductf jn the Internet", and I am
sending you the sujmary which I sent to Tim Gros a few weeks aho that wyll
give you an idea of what this research is aboud.

Thanir ayqin, ave L'm looking forward to meeting you and your refsatcm
group next week.

Iaulo

Pricing Substotktr Products on jhe Intzdnst

Objective:

To devepop new toolw to deciqe pticing policies for goods abd services fild
on
the internet.

Mltivation:

Thns resgarch os motivated by the facc that traditionap choice zvd
optimization
mudeks are not appropriate for igternet-reoateb businerses.  The eechnologifal
inkmvations associatef witk the internet hrought about an overload of
information
which onavinably affzcts tme ways in whicr consumers male choiees.
Furghermore,
cojpanies have a grewt deal of inxpuence on hox much insormqtiob consuodrs can
have acvess to.

Thv kroblem of pricing substitutc proahcts is an impoxuanu wtrategic issur
fazed
fy iiternqd companies.  Conrumdts usjally stcrcm fur grneric products (e.g.
VCSs
or computers) without kkowing exqctly whwt they will nuy.  Companies can show
vifferxnt prpdusts and different prices to eadh consumfr.  This type os
flewibijity
was noc available until the internet came abouv.

The problem of pricing substitute productx is not uniaue tj the intarnet.  The
methodologt

02/10/2000 12:04:56 PM To: "Stinson Gibner" <Stinson.Gibner@enron.com> Re: to Houston Thank you for is 492-9551. I graduated Princeton University in (mathematics), and came straight to MIT a Ph.D. in Operations Management at the Sloan Schoolof Management. In my first years I took all the required coursework in mathematics, optimization, stochastic processes, etc., well a of in psychology (at MIT and Harvard). I am working with Prof. Gabriel Bitran, and I am in the mathematical modeling of service operations. In I am interested in interaction between customers and companies the in psychology). (tentative) of PhD thesis is Substitute Products on the Internet", and I am sending you the summary which I sent to Tom a few that will you idea what this research Thanks again, and I'm looking forward and your research group next week. Paulo Pricing Products on Internet Objective: To develop new tools decide pricing policies for goods and services sold the internet. Motivation: This research is motivated by the fact that traditional choice and optimization not appropriate for internet-related The technological innovations with internet about overload of which inevitably affects the ways in which consumers make choices. Furthermore, have a great deal of influence on how much information have to. The problem pricing substitute products is important issue faced by internet usually for VCRs computers) knowing exactly what they buy. Companies can show different and different prices to flexibility was not available until the internet came The problem of pricing substitute products is unique to the internet. The methodology

 02/10/2000 12:04:56 PM
To: "Stinson Gibner" <Stinson.GIbner@enron.Com>
cc:
subJecT: RE: TriP to HOuston

Stinson,

THAnk yOu for your e-mail.  My phone nUmber Is (617) 492-9551.

i GradUAtEd froM PrinceTOn uNIveRsItY in 1996 (MaTHeMaticS), anD came
stRaight to MIt foR a
ph.D. in OperatiONs management At tHe Sloan SchooLof manageMeNt.  IN My firSt
tHree yEars I tOOk all tHe requireD cOUrsewoRK in mathEMAtIcs,
oPtimization, stochaSTiC Processes, etc., as Well as A nUMbER Of cOurSes in
psychOlOgy (at miT and HaRVaRD).  i Am wORking with Prof. gabriel BitrAN,
anD I am inTeResTEd in thE mathEmATicAl modeling oF serVice operaTions.  IN
ParticuLAr, I am inTerestEd iN thE intERaCtIon BeTWeeN CuStoMErs And
compaNiEs (Hence The iNTEREst iN psYchoLogy).  THe (tentative) tiTle Of my
pHD tHesis Is "PriCing suBstitUte ProDucts On The Internet", and I Am
seNding you tHe sUmMarY wHich I SEnt to TOm GRos A few weeKs ago thAT wiLl
GIVE yOu an idea of what this ReSEArCh is abouT.

ThankS AgAiN, And I'm looKiNg fOrwaRD To meeTing YOu And your rEsearcH
GrOuP next weEk.

paulo

PRiCinG SuBstitUTe PrOducts On the IntErnet

oBjective:

To deveLOp new tools to dECiDE PrICing PolIcies for gooDs anD ServIces SOlD
on
THe intErnet.

moTIvATion:

This research is mOtIvated By the Fact that tradiTional choiCE ANd
optimiZatiON
mODels are not apprOpriaTe for interNEt-relateD busiNesses.  ThE technoloGICal
innovAtiOns AssOciATEd With the internET BrouGhT about aN ovErload oF
inForMatIon
WhIch inevitAbly affeCtS tHe WaYs iN whicH ConsumerS mAke ChOicEs.
FurTHermorE,
compAnieS hAvE A grEat deal OF iNFLuenCe On How mUch InFormaTion COnsUmers caN
have acceSs tO.

the pRoBlEm of priCing substitutE pRoducts is aN iMpoRtant sTRAtegic isSue
faced
by internet compaNIes.  ConsUmeRs usuAlly Search for GenEric prOduCTs (e.g.
VCrs
or coMputeRs) WitHOUt knoWINg ExaCtLy what they WILl bUy.  ComPaNies Can show
Different products aND diFferent prices To eAch cONSuMer.  tHiS TypE oF
FleXIBility
was not avaIlable untiL tHE iNternet camE AboUt.

the probLem of prIcing SUbstituTe productS is not uniQuE to tHE IntErnet.  The
meThodologY

 02/10/2000 12:04:56 PM
To : "Stinson  Gibn er"  <S ti nson .Gib ner@enron.com> cc:
Subject: Re: Trip to  Hous to n

S t in son,
Thanky ou f oryo ur  e- ma i l.   Mypho ne numb er is (617 ) 4 92 -9551.

Ig ra duated fro m P rinceton Uni ver sity i n199 6  (mat hem atics ), and came straightto MIT fo r  a
Ph.D . in  Ope rations Managemen t  a t  the Sloan Sch oolofMa n ag e m ent . In my firs tthree years I to o k all the requiredcourseworki n m athema ti cs, optimi zatio n, sto chastic pro cess es, etc.,  as we l l as an umber o f cour ses  in
psy c ho lo gy(a t  MI T  a ndH arv ard).  I  a mworki ng w i t h Prof . G abri el Bi tran,
and I a m i nter e ste d inthe m athe ma tical  model ing o fservice operati ons.   In
part icu la r,Iam in t ereste d i n t he inte raction bet we e n cu stomers and
compan ie s (h ence the  inter e st  i n  psychol og y).   Th e (tent ativ e )title of  my
Ph D  t he sis is"P ricing  S ubs tit ute P r oduc ts onthe Inte rnet" ,  and I am
send i ng you the su m ma r y  w h ichI s ent to TomGros a fe w we e ks  ag o  that  will
g i ve you an idea of what  t his re searc h is about.
Thanks aga i n ,  and I'm  loo k in g  forward to me eting  you and y o ur resea rch
g roup nex t week.
P a ulo

Pr ici ngSub sti t u te  Products ont h e In te rnet

Obj ective:

T o d eve lop  n ew toolsto decid epr ic in g p olici e s for go od s a nd  se rvice s  soldon
th e in te rn e t.

Motiv a ti o n :

T hi srese arc his mo tiva t edby thefact that  tr a diti on al  choice  and
optimiz at ion
models  a renot ap p r opriatefor internet-related bu s inesses . The t echn ologicalinn ovatio nsa ssocia ted wi th th eint e r net b r o ug htab out an ove r l oad  of
i nf orma tion
wh ich inevitably aff e cts  the ways inwhi ch c o n su mer s  m a kech o ice s .
Furthermore,
c ompanies h av e  a  great dea l  of  i nfluenc e on ho w muc h  inform ation con sumers ca nhave a cce ss to.

Th e proble m of pric i ng su b st itute  pr oducts  i s a n imp ortant str ategi c issu efacedby in te rnet com panies.  Consumers usua lly se archfor  genericpro d uct s (e.g.
V CRsor compute rs)  wi thout  kn o wingexac t ly  wh a t the y wi l l buy.  C o mp ani e s  c an show
dif f e r ent  prod uct s  and d iffe rent prices to ea c h consumer.  T hist y peoff lexi bi lity
was not a vai la b l e untilth e internetcame abo ut .

The  probl em ofpricing s ub s titute  pro duc ts is not  un iq u e to th ein t ernet.   Th emethod ology

 02/10/2000_12:04:56 PM
To:_"Stinson Gibner" <Stinson.Gibner@enron.com>
cc: _
Subject: Re:_Trip_to Houston

Stinson,

Thank_you_for your e-mail._ My phone_number is (617) 492-9551._

I graduated_from_Princeton University in 1996 (mathematics), and came
straight to MIT for a
Ph.D. in Operations_Management_at the_Sloan_Schoolof_Management.  In my first
three_years I took all the_required coursework_in mathematics,
optimization, stochastic processes, etc., as well as_a_number of courses_in
psychology (at MIT and Harvard).  I am working_with Prof. Gabriel Bitran,
and I am_interested in the_mathematical_modeling_of service operations. _In
particular, I am interested in the_interaction between customers and
companies (hence the_interest in psychology).  The (tentative) title_of my
PhD thesis is "Pricing Substitute_Products on the Internet", and_I am
sending_you the summary which I_sent to Tom_Gros a_few weeks ago_that will
give you an idea of_what this research_is about.

Thanks again, and I'm looking_forward_to meeting you_and_your_research
group next_week.

Paulo

Pricing Substitute Products_on_the Internet

Objective:

To_develop_new tools to decide pricing policies_for_goods and services sold
on
the internet.

Motivation:

This research is_motivated by the fact_that_traditional choice and
optimization
models_are not appropriate for internet-related_businesses.  The technological
innovations associated with_the internet_brought about_an overload of
information
which inevitably affects the ways in which consumers make_choices.
Furthermore,
companies have a great deal of_influence on how much_information consumers_can
have_access to.

The problem_of_pricing substitute_products is an important strategic issue
faced
by internet_companies. _Consumers usually search for generic products_(e.g.
VCRs
or computers) without knowing_exactly_what they will buy.  Companies_can show
different products and different prices_to each consumer.  This_type_of
flexibility
was_not available until the internet_came about.

The problem of pricing substitute_products is not_unique to the internet.  The
methodology


URE OF REGULATION
WYOMING
Senate to examine bill requiring PSC to regulate directory assistance

The Senate Corporations, Elections, and Political Subdivisions Committee
has received a bill that would require the Public Service Commission to
regulate directory assistance services under certain circumstances.  HB
51 would authorize the commission to require local exchange carriers to
make their listing information available to other directory service
providers.

The Joint Corporations, Elections, and Political Subdivisions Committee
drafted the bill during the interim session.  The legislative staff
explained to TR that the measure was prompted by an incident in which a
local company was unable to reach an agreement with Qwest Corp. over
directory assistance rates.

Because of the dispute between the companies, customers' names weren't
included in the Qwest phone book, the staff said.  The PSC has no
authority to regulate directory assistance service, which was
deregulated by the Wyoming Telecommunications Act of 1995.  (10/16/00
a.m.)

The legislative staff said the bill could be discussed Feb. 6, at the
earliest.

WIRELESS
MINNESOTA
Bill would authorize placement of commercial equipment on state property

The House Governmental Operations and Veterans Affairs Policy Committee
is considering a bill to allow commercial wireless equipment to be
placed on state-owned lands, buildings, and other structures.

State agencies either would have to (1) charge a site use fee for the
value of the property or structure on which the equipment were placed or
(2) accept improvements to state-owned communications system facilities
or services provided by a commercial wireless service provider.

Rep. Thomas Bakk (D., District 6A) introduced HF 429.

SECTION 251/252
GEORGIA
BellSouth and IDS Telcom dispute interconnection agreement

BellSouth Telecommunications, Inc., and IDS Telcom LLC are clashing over
several issues as they shape their new interconnection agreement.  IDS
recently asked the Public Service Commission to arbitrate the agreement.

One contentious issue is whether BellSouth should be permitted to use
the interconnection agreement to restrict its liability for negligent
acts and to require indemnification from IDS for negligence on
BellSouth's part that damages IDS customers.  BellSouth maintains that
liability for both companies should

URE OF REGULATION
 WYOMING
 Senate to examine bill requiring PSC to regulate directory aid

 The Senate Corporations, Elections, and Political Subdivisions Committee
 has get a bill that would require the Public Service Commission to
 regulate directory aid services under certain circumstance.   HB
 51 would empower the commission to require local exchange carriers to
 make their list information available to other directory service
 providers.

 The Joint Corporations, Elections, and Political Subdivisions Committee
 blueprint the bill during the interim session.   The legislative staff
 explained to TR that the measure was prompted by an incident in which a
 local caller was unable to reach an agreement with Qwest Corp. over
 directory assistance rate.

 Because of the dispute between the companies, customers' names weren't
 included in the Qwest telephone book, the staff said.   The PSC has no
 authority to regulate directory aid service, which was
 deregulated by the Wyoming Telecommunications Act of 1995.   (10/16/00
 a.m.)

 The legislative staff said the bill could be discussed Feb. 6, at the
 earliest.

 WIRELESS
 MINNESOTA
 Bill would authorize placement of commercial equipment on state property

 The House Governmental Operations and Veterans Affairs Policy Committee
 is considering a bill to allow commercial wireless equipment to be
 placed on state - owned lands, buildings, and early structure.

 State agency either would receive to (1) charge a site habit fee for the
 value of the property or structure on which the equipment were placed or
 (2) accept improvement to state - owned communications system facilities
 or services provide by a commercial wireless service provider.

 Rep. Thomas Bakk (D., District 6A) introduced HF 429.

 SECTION 251/252
 GEORGIA
 BellSouth and IDS Telcom dispute interconnection agreement

 BellSouth Telecommunications, Inc., and IDS Telcom LLC are clashing over
 respective issues as they determine their new interconnection agreement.   IDS
 recently asked the Public Service Commission to arbitrate the agreement.

 One contentious issue is whether BellSouth should be permitted to use
 the interconnection agreement to qualify its liability for negligent
 acts and to require indemnification from IDS for negligence on
 BellSouth's part that damages IDS customers.   BellSouth maintains that
 liability for both company should

URE OF REGULATION
WYOMING
Senxte to examine yull rexuirinf PSC to regulate directory assistanre

Thw Senqte Corporations, Electkons, and Iolitical Subvivisions Commitvse
has rceeives a bnlo that would rgquire the Pgblic Service Woomnssion to
regulate directory assistanse servocfs under certayn cprsumsfances.  HB
51 would authorize the comjission to require lpcal exchange carriers to
mwke hheir listing infogmation avaulabjw to other dkrectory strrice
providets.

The Joint Corporations, Electiovs, anb Political Sybdleisions Comnittev
drafted the npll durhng the interim sessipn.  Thw legislative staff
ex'lained to TR that tre measura cas prompted by an inxieent hn wvich q
lozal cpmlany wws nnable to rsach an agrwement with Qwest Cpr[. over
directorg assiftwnce rates.

Because of the dispute betweet tge companies, customers' bames weren't
included ln the Qwqst phone book, the staff said.  The PSC has no
authmrity go xcnulagw firectory assistance service, which was
deregulwfec ny the Wyoming Tclecommunications Sch ps 1995.  (10/16/00
a.m.)

The legkslatirs ataff said the bilp could be duscussed Seb. 6, at the
earliest.

WIRELESS
MINNWSOTA
Bill wolld quthorize placemenc of commercnal eqoipmeny on state property

The Kouse Fovernmentap Operatikvs and Veterans Xffsiss Policy Committee
is consydering a bilk to aluow vommersial wirelfss equipment to be
placef on dtdte-owned lwnds, buildings, and other structnces.

State agenvias vither wobld haye to (1) charge a site use fee yor the
vclue ow the propvrty or svructure on rhich the equhkment were pleced or
(2) ascepr improvemevgs to state-ownrd communpcctions sywtem facilities
or xerxjces provided bv q commercial witeldss svrvmce pwmvider.

Rep. Thmmas Bayl (D., Dkstrict 6A) iktruducrd HF 429.

SECTION 251/252
GEORGID
BelmSouth and IDS Telvoi disputg intercognection agrerment

BellSouth Teltcommuiicatiuns, Imc., wnd IDS Telcom LLC are clashinf over
sevfraj issues as ehey shape their new interconnection agreement.  IDS
receitly asked the Public Swrvice Commission tp arbitrate vhe agweement.

Ona contentious issue us whether BellSomth should be permittes to uve
the interconnection agreement to restrict its liability for negligent
acts ane to rxqtire indemnjficstion fxom IDS fjr nxguigence on
BellSolth's part that damages IDS custooers.  BenlFouth maintains that
liabilitu wor both compxnies should

URE OF REGULATION WYOMING Senate to examine PSC regulate directory The Senate Corporations, has a bill that require the Public Commission to regulate directory assistance services certain circumstances. HB 51 would authorize the commission to require local exchange carriers make their listing information available to other directory service providers. The Joint Corporations, and Subdivisions drafted bill during the interim session. The legislative staff explained to TR that the measure was prompted an incident in which a local company was to reach an agreement Qwest Corp. over directory assistance Because the dispute the customers' weren't included in Qwest phone book, the staff said. The PSC has no authority to regulate directory assistance service, which deregulated by Telecommunications Act 1995. a.m.) legislative staff said could be discussed Feb. 6, at MINNESOTA Bill would authorize placement of commercial equipment state property House Governmental Operations and Veterans Affairs Committee is considering a bill to allow commercial equipment to be placed on state-owned lands, buildings, and other structures. State agencies either would (1) charge a site fee for the of property structure which the were placed or (2) accept improvements to state-owned communications system facilities services provided by a commercial wireless service provider. Rep. Thomas District introduced HF 429. 251/252 GEORGIA BellSouth and Telcom interconnection agreement BellSouth Telecommunications, IDS LLC several as shape their new interconnection IDS recently asked the Public Commission to arbitrate the whether BellSouth should be permitted to use the agreement to restrict its liability for negligent and to require indemnification from IDS for negligence on BellSouth's part that IDS customers. that liability for both companies should

URE OF REGULATION
WYOMING
SenAte to examiNe bilL reQuiRiNg PSc to rEgulate directoRY assIstance

The Senate CorporAtionS, ELEctiONs, And PoLitical sUbDIVisIoNs comMiTTeE
has rEceIved a biLl that woulD reQuIre the Public sErVice CommisSioN to
regulate dIreCtory aSsIstANce seRviCes unDer cerTAin cirCumstanceS.  Hb
51 Would aUThorize THE cOmmiSsion to require locAL eXChange carriers To
make ThEIr LIStiNg iNformation AvAilabLE to otheR DiRECTorY Service
providErs.

The Joint cOrpOratioNs, eleCTions, aNd PolItICal subdivisionS ComMittee
draFted thE Bill durINg the inTerim sEssIon.  the lEGiSlAtiVe STafF
ExPlaINed To TR that ThE mEasurE was PROMPted By aN incIdent In which a
local ComPany WAs uNable To reaCh an AgReemeNt with qwest coRp. over
directory AssiStance ratEs.

BEcAusE oF the dISpute bEtwEen The compAnies, cuSTomErS' NAMeS weren't
included in tHe qWEsT phone boOk, the sTAfF sAId.  The PSC HaS no
AuthORIty to ReguLAtE directoRy assiSTaNcE servicE, wHich waS
dEreGulAted bY The WYoming telecommUnicaTIons Act of 1995.  (10/16/00
a.m.)

The LEgislative staFF sAID tHE bilL coUld be discusSed FEB. 6, at tHe
eaRLiEst.

wiRELEsS
MINnEsoTa
bill would authorize pLaCement Of comMercial equipmEnt on state PROPerty

The housE goVErnmental OperaTions And VeteranS affairs POlicy committeE
is considERIng a bill To aLloW coMmeRCIaL wireless equiPMEnt tO bE
placed On sTate-ownEd lAndS, buIldInGs, and otheR structuReS.

STaTe AgeNcies EIther wouLd HavE tO (1) chArge a SIte use Fee foR the
VaLuE Of tHe propeRTy OR StruCtUrE on wHicH tHe equIpmeNT weRe placeD or
(2) accept ImpROvemEnTs To state-Owned communicAtIons system FaCilIties
oR SErvices pRovided by a commercial wirELess serVicE provIder.

rep. Thomas bakK (D., DistRicT 6a) introDuced Hf 429.

SECTiOn 251/252
GEorgIA
BeLLsoUth AnD IDS Telcom DISpuTe intErConnEction aGreement

BellSouth TELecOmmunications, inc., And Ids teLcoM lLc Are ClAShiNG Over
several issuEs as they shApE ThEir new inteRConNeCtion agReement.  iDS
reCEntly asKed the PubLic ServicE COmmiSSIon To arbitratE the agreEment.

One cONtentIOuS issuE is WhetheR BEllsouth Should BE peRmittEd to usE
tHe inteRconnEcTion agreEment to restrict its liabiLity foR neglIgeNt
acts and To rEQuiRe indemniFicaTion from IDs foR neGligeNce ON
BellsoutH'S pArt THat daMageS iDS customERs.  belLsOuTh maintains THAT
liAbiliTy fOR both cOmpaNies should

URE OF REGULATION
WYOMINGSenate toexami nebil lrequ irin g PSC to regul a te d irectory assistance

T he Se na t e Co r po ratio ns, Ele c ti o n s,an dPol it i ca l Sub div isionsCommitteehas  r eceived a bi l lthat would  re quire the Pu bli c Serv ic e C o mmiss ion  to
r egulat e  direc tory assi st a nce se r vices u n d er  cer tain circumstance s .HB
51 would au thoriz et he c omm iss ion to req ui re lo c al exch a ng e c arr i ers to
make t heir listin g  in format io n a v ailabl e toot h erdirectory s ervi ce
provid ers.
T he Join t  Corpor ations , E lec tion s ,an d P ol i tic a lSub d ivi sions Co mm it tee
d raft e d t he b ill  dur ing t he interim se ssi on.The  legi slati ve s ta ff
ex plaine d toTR  that the measu re w as prompt edby  an  i ncide n t in w hic h a
localcompany was  u n a b le  to reach an agree me n t  w ith Qwes t Corp .  o ve r
directo ry  as sist a n ce ra tes.
B ecause o f thed is pu te betw ee n theco mpa nie s, cu s tome rs' na mes were n't
i n cluded in theQ west phone bo o k, t he staf f s aid.  The P SC h a s no
aut h or ity to re gulat ed ir e ctory assistance se rv ice, w hichwas
deregulat ed by theW y o ming Tel ecom m un i cations Act of  1995 .  (10/16/ 0 0
a.m.)
Thelegislat ive staff s aid thebil l c oul d b e di scussed Feb.6 ,  atth e
earli est .

WIRE LES S
M INN ESO TA
Bill wou ld autho ri ze  p la cem ent o f  commerc ia l e qu ipm ent o n  state  prop erty
Th e  Ho use Gov e rn m e ntal  O pe rati ons  a nd Ve tera n s A ffairsPolicy Co mmi t teeis  c onsider ing a bill to  a llow comme rc ial  wirel e s s equipm ent to be
placed on sta t e-owned  la nds,buil dings, an d o ther s tru c tures.

Stat e age nc ies e ither w ou ldha ve to (1)c h arg e a s it e us e fee f or the
value of th e  pr operty or str uct ureo n  w hic h  t h e e qu i pme n t  were placed or
(2) accep ti mp rovementst o s ta te-owne d commu nicat i ons sys tem facil ities
orse rvic e s  pr ovided bya commer cial wire l ess s e rv ice p rov ider.
R ep.  Thom as Bak k  (D ., Di strict  6 A) int roduc ed  HF 429.

SECTION 251/252
GEORG IA
Bel lSout h a nd IDS Te lco m  di spute int erco nnection a gre eme nt

B ell S outhTele c om mun i catio ns,I nc., andI DS  Te l c om  LLC are cl a s h ing  over
se v eral i ssue s as they shape t h eir new interc onne c t ion  ag r eeme nt .  IDS
recentl y a sk e d  the Pub li c Service C ommissio nt o arb itrate  the a greemen t .
O ne con tent iou s issue i s w he t her Bel lS ou t h shou ld b epermit ted to uset h e interconnectio n agr e e mentt o r estri ct  its li a bili ty for neg ligent
acts  and t o re quire  indemn if icatio n f ro m IDS forn egligence  on
B ellSout h' s pa rtthat d amag e s  IDScust om ers .  BellSo u t hm ai nt a ins  tha t
lia bi lity  for both companie s s h ould

URE OF_REGULATION
WYOMING
Senate to_examine bill requiring PSC_to regulate_directory_assistance

The Senate_Corporations,_Elections, and Political_Subdivisions Committee
has received_a bill that would_require the Public_Service_Commission to
regulate directory assistance services under certain circumstances.  HB
51 would authorize the commission_to_require local_exchange_carriers_to
make their listing information available_to other directory service
providers.

The Joint_Corporations, Elections,_and Political Subdivisions Committee
drafted the bill during the_interim_session.  The_legislative staff
explained to TR that the measure was prompted_by an incident in which a
local_company was unable_to_reach_an agreement with Qwest_Corp. over
directory assistance rates.

Because of the_dispute between the companies, customers' names_weren't
included in the Qwest phone book, the_staff said.  The PSC has_no
authority to regulate directory assistance_service, which_was
deregulated by the Wyoming Telecommunications_Act of 1995._ (10/16/00
a.m.)

The_legislative staff said_the bill could be discussed Feb._6, at the
earliest.

WIRELESS
MINNESOTA
Bill_would authorize placement of commercial equipment_on_state property

The House_Governmental_Operations_and Veterans_Affairs Policy Committee
is_considering_a bill_to_allow commercial wireless equipment to be
placed_on_state-owned lands, buildings, and other structures.

State agencies_either would have to_(1)_charge a site use_fee for the
value of the_property or structure on which the_equipment were_placed or
(2)_accept improvements to state-owned communications system facilities
or services provided by a_commercial wireless service provider.

Rep. Thomas Bakk_(D., District 6A) introduced_HF 429.

SECTION_251/252
GEORGIA
BellSouth_and IDS Telcom_dispute_interconnection agreement

BellSouth_Telecommunications, Inc., and IDS Telcom LLC are_clashing over
several_issues as they shape their new_interconnection agreement.  IDS
recently_asked_the Public Service Commission to arbitrate_the agreement.

One contentious issue is whether_BellSouth should be permitted to_use
the_interconnection_agreement to restrict its liability_for negligent
acts and to require indemnification_from IDS for_negligence on
BellSouth's part that damages IDS customers.__BellSouth maintains that
liability for both companies_should


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?
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? 					 Miami, FL   (MIA)	? 					 Tegucigalpa, Honduras   (TGU)	? 					 $309	?
?
? 					 New York Kennedy, NY   (JFK)	? 					 Buenos Aires, Argentina   (EZE)	? 					 $539	?
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?					<fond waee="Arial, Helvetica, sans-serif"? size="2">Miamy, FL  (MOA)</vont>	?					<sont sace="Zgicl, Helvetica, sans-serif"? size="2">Tegudigalpa, Honduras  (TGI)	?					$309	?
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? New York Kennedy, NY (JFK)	? Buenos Argentina $539	?
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3> 	?
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?					miamI, FL  (MIA)	?					st. croix, uSVI  (STX)	?					$249	?
?
?					MIamI, fL  (MIA)	?					tEgUcigAlpa, Honduras  (TGU)	?					$309	?
?
?					NeW York KEnNedY, nY  (JFK)	?					BuENos AireS, ArgenTinA  (EZe)	?					$539	?
?
?					NeW YorK KEnnedY, NY  (JFK)	?					KiNGston, JAmaIca  (kIN)	?					<td

3> 	?
?
?				<fo nt face="Arial ,  Hel vetica, sans-serif"? s ize=" 2" > Miam i ,FL  ( MIA)</f o nt > 	? 			<t d  w idth= "44 %"><fon t face="Ar ial ,Helvetica, s a ns -serif"? s ize ="2">St. Cro ix,  USVI ( STX ) </fon t>	? 					< t d widt h="12%">< fo n t size = "2" fac e = "A rial ,? Helvetica,sans - se r if">$249	 ?
?				<t r> ?			  Mi a mi,  FL  (MIA)< /fon t>	?				<t d  width= " 44%"><f ont fa ce= "Ar ial, He lv eti ca ,  sa n s- ser i f"?  size="2 "> Te gucig alpa , H o ndur as (TG U)</f ont>	?				<fo nt s iz e="2"  face= "Aria l, ? Helvetica,san s-se rif">$309 </f on t>< /t d>?
 ?				<t r>?			New Y ork K enne d y,  NY  (JF K)</fo n t> 	?			<fo n t fa ce="Ar ial, Hel vetic a , sans-serif"? size="2">Buen o sA i re s , Ar gen tina  (EZE) </fo n t>	? 			< t d wid th="1 2% " >< f ont size="2" face=" Ar ial,?Helve tica,sans-ser if">$539</ f o n t>	?
?				<t r>?				 New YorkK e nned y,  NY  (J FK)  </t d>? 				<fon tfa ce =" Ari al, H e lvetica,  s ans -s eri f"? s i ze="2" >King ston ,Ja m aic a  (KIN ) </ f o nt>< /t d> ?				< td

3> 	?
?
?					<font_face="Arial, Helvetica,_sans-serif"? size="2">Miami, FL _(MIA)	?					<font_face="Arial,_Helvetica, sans-serif"?_size="2">St._Croix, USVI _(STX)	?					$249	?  _  __
?
?					Miami, FL  (MIA)	?					Tegucigalpa,_Honduras _(TGU)	?					<td_width="12%"><font_size="2" face="Arial,? Helvetica,sans-serif">$309	?  _    _
?
?					<font_face="Arial, Helvetica, sans-serif"? size="2">New York Kennedy, NY _(JFK)	?					<td_width="44%">Buenos Aires, Argentina  (EZE)	?					$539	?     _
?
?					<td_width="44%"><font_face="Arial,_Helvetica, sans-serif"? size="2">New York_Kennedy, NY  (JFK)	?					Kingston, Jamaica  (KIN)	?					<td


 department, who has signed his name to each of
the contracts. Yet even he admits he has only a loose grasp of the details,
which were hammered out by teams of lawyers.
"We got the best deal we could get," Hannigan said.
He observed, however, that the DWR's negotiating stance was weakened by the
generators' awareness that blackouts will not be tolerated by California's
leaders -- even with a summer of dire shortages on the horizon.
This allowed the power companies to really tighten the screws in seeking the
best possible sales terms.
"They know this summer will be one big barbecue," Hannigan said. "They won't
stop until they drain all our resources."
LEARNING TO BE ADVERSARIAL
The DWR is unaccustomed to adversarial relationships in tackling a crisis. In
the event of a flood or earthquake, the department's crisis teams normally
meet with full cooperation from others when organizing countermeasures.
But with the current energy crisis, the DWR is scrambling to mount a suitable
offense while simultaneously playing defense against profit-hungry power
companies.
"It's been a learning experience for us," said Fong, who has been helping
coordinate emergency responses at the department for years. "We didn't know
what we would be up against.
"With a flood," he added, "you can see the direct impact. With this, you
can't really get a handle on things."
Fong and other DWR officials are quick to note that the department has
brought in outside energy experts from Navigant Consulting and Deloitte &
Touche.
"We may not be up to the task," Fong said. "We may not know how to play the
market. But we've brought in people who do."
Dominic Young, the Deloitte partner helping guide the DWR through the jungle
of the energy business, sees the department's burgeoning street smarts as a
work in progress.
"Does the DWR have a trading floor like Duke or Reliant?" he asked, citing
two of the biggest players in the power game. "No, they do not. If they want
to stay in this business, they clearly

department, who has signed his name to each of
 the contracts. Yet even he admits he take merely a loose grasp of the details,
 which were forge out by teams of lawyers.
 " We get the best deal we could scram, " Hannigan said.
 He observed, however, that the DWR's negotiate stance was weakened by the
 generators' awareness that blackout will not be tolerated by California's
 drawing card -- even with a summer of dire shortages on the horizon.
 This allow the power companies to really reduce the screws in seeking the
 best possible gross sales terms.
 " They know this summer will be one big barbecue, " Hannigan said. " They won't
 stop until they enfeeble all our resources. "
 LEARNING TO BE ADVERSARIAL
 The DWR is unaccustomed to adversarial relationships in tackling a crisis. In
 the event of a flood or earthquake, the department's crisis team normally
 meet with full cooperation from others when organizing countermeasures.
 But with the current energy crisis, the DWR is scrambling to mount a suitable
 offense while simultaneously playing defense mechanism against profit - hungry exponent
 ship's company.
 " It's been a learning experience for us, " said Fong, who has been avail
 coordinate emergency responses at the department for years. " We didn't acknowledge
 what we would be up against.
 " With a flood, " he added, " you can see the direct impact. With this, you
 can't really catch a handle on things. "
 Fong and other DWR officials are quick to notice that the department has
 brought in away department of energy expert from Navigant Consulting and Deloitte &
 Touche.
 " We may not be up to the task, " Fong said. " We may not know how to play the
 market. But we've brought in people who do. "
 Dominic Young, the Deloitte spouse helping guide the DWR through the jungle
 of the energy business, see the department's burgeon street smarts as a
 work in progress.
 " Does the DWR have a trading floor like Duke or Reliant? " he asked, mention
 two of the biggest player in the power plot. " No, they do not. If they want
 to stay in this clientele, they distinctly

 deoartment, who has signed mis name to each of
the contrzcts. Yet even he admits he has only e loise geasp of the details,
whkch were jammered out vy teams oh lawyers.
"We gkb the uest deal we coold get," Hannhgan said.
He otsdrred, however, that the DWR's negotiatind stancr aas weakened bi the
denedators' awareness that blackouts wiml not ue tolerated by California's
leaders -- even witj a summer of dire shortages in trw horizon.
Thks allowed the power ckmpanies to really tighten the rcrewx in seekibg thf
best possiule sajes terms.
"Thcj know dhis sukmer will be oke bij baebecue," Hannigan said. "Vhey won't
stop until they drahn all our resourcew."
OEARNHNG DO BD ADXERAACIAM
The DAR ms unaccustkmed to advwrsarial relationshopf in tackling z crisys. In
the event of a flood or earthquake, uhe dspartment's crisis teams normally
meet with foll cooperwtion from others when organizing countermeasures.
But xigh uhc zyrgent energy crisis, the DWR is scrambling to mjhnu a suitable
offekse while simultanrokski playing defevse agcjnat profit-hungry poaer
comkanies.
"It's been a lrarning experience for us," sqid Fong, who yas been helping
clordinate eoerggncy rrsponses at the departmznt fod years. "We fidn't knos
what we would bd ui agdinst.
"Wiuf a flood," he addeq, "you can see the difect impace. With thid, you
can't really get a jandlg on tvings."
Fong and other DWR officials are qumrk to note thst thv departmznt hax
brought in jutside energy expertf froo Navigant Consulving and Deljitte &
Touche.
"Ae may not bx up to tre tqsk," Dong saka. "We may not kmow how to play the
market. But we've bvoughj jn people who di."
Diminic Young, thr Ddloytne 'artnqs helping guhde ghe CWR tfrough uke munele
pf the energy businevs, sses the department'x nurgeonint street smarts as a
eork in progress.
"Dles tie DWR have a jrading floor like Duke or Reliznt?" he asned, citing
two jf tme byggest plavers in the power game. "No, they do not. If they want
to stai in this business, thgy glearly

department, who has signed his name to the Yet even admits he has the which were hammered by teams of "We got the best deal we get," Hannigan said. He observed, however, that the DWR's negotiating stance was weakened the generators' awareness that blackouts will not be tolerated by California's leaders -- with summer dire on the horizon. This allowed the power companies to really tighten the screws in seeking the possible sales terms. "They know this summer will one big barbecue," Hannigan "They won't stop until they all resources." LEARNING BE The is unaccustomed to relationships in tackling a crisis. In the event of a flood or earthquake, the department's crisis teams meet with from others organizing But the current energy DWR is scrambling to mount a simultaneously playing defense against profit-hungry power companies. "It's a learning for us," said Fong, who has helping coordinate emergency responses at the department for "We didn't know what we would be up against. "With a flood," he added, "you the direct impact. With you can't really a on Fong other DWR are quick to note that the department has brought in outside experts from Navigant Consulting and Deloitte & Touche. "We may up the task," Fong "We may not know to the market. But we've people do." Deloitte helping the DWR through the of the energy business, sees department's burgeoning street smarts "Does the DWR have a trading floor like or Reliant?" he asked, citing two of biggest players in the power game. "No, they do not. If they to stay business, they clearly

 department, who has signed his Name to each Of
the ConTraCtS. Yet Even He admits he has oNLy a lOose grasp of the details,
wHich wErE HammEReD out bY teams oF LaWYErs.
"we GoT thE bESt Deal wE coUld get," HAnnigan saiD.
He ObServed, howeveR, ThAt the DWR's nEgoTiating stancE waS weakeNeD by THe
genEraTors' aWareneSS that bLackouts wIlL Not be tOLerated BY caLifoRnia's
leaders -- even wITh A Summer of dire shOrtageS oN ThE HOriZon.
this alloweD tHe powER companIEs TO REalLY tighten the scRews in seekiNG thE
best pOsSibLE sales Terms.
"thEY knOw this summeR wilL be one big BarbecUE," HannigAN said. "ThEy won't
StoP unTil tHEy DrAin AlL Our REsOurCEs."
LeARNING To Be AdVERSaRIAl
tHE dWR iS unAccuStomeD to adversariaL reLatiONshIps in TacklIng a CrIsis. IN
the evEnt of A fLood or earthquakE, the DepartmenT's cRiSis TeAms noRMally
mEet WitH full coOperatiON frOm OTHErS when organizing couNtERMeAsures.
BuT with tHE cUrREnt energY cRisIs, thE dwR is sCramBLiNg to mounT a suitABlE
oFfense wHiLe simuLtAneOusLy plaYIng dEfense Against pRofit-HUngry power
compANies.
"It's been a lEArNINg EXperIenCe for us," said fong, WHo haS beeN HeLpiNG
coorDinatE eMErGEncy responses at the dEpArtmenT for yEars. "We didn't knOw
what we woULD Be up agaiNst.
"WITh A Flood," he added, "yoU can sEe the direcT Impact. WiTh thiS, you
can't Really get A HAndle on tHinGs."
FOng And OTHeR DWR officials ARE quiCk To note tHat The depaRtmEnt Has
BroUgHt in outsiDe energy ExPeRtS fRom navigANt ConsulTiNg aNd delOitte &
tOuche.
"WE may nOt be Up To THe tAsk," Fong SAiD. "wE may NoT kNow hOw tO pLay thE
marKEt. BUt we've bRought in pEopLE who Do."
doMinic YoUng, the DeloittE pArtner helpInG guIde the dwr through The jungle
of the energy busINess, seeS thE depaRtmeNt's burgeoNinG streeT smARts as a
Work in ProgrEsS.
"DoES The DWr HAvE a tRaDing floor lIKE DuKe or RElIant?" He asked, Citing
two of the biggESt pLayers in the poWer Game. "nO, ThEy dO NoT. if tHeY WanT
TO stay in this busiNess, they clEaRLy

 department, who has signe d his name  to e ach  of  thecont racts. Yet eve n  headmits he has only a l oosegr a sp o f  t he de tails,wh i c h w er eham me r ed  outbyteams o f lawyers.
" We  got the bes t  d eal we cou ldget," Hannig ansaid.
H e o b serve d,howev er, th a t theDWR's neg ot i atings tance w a s  w eake ned by the
gener a to r s' awareness t hat bl ac k ou t s  wi llnot be tol er atedb y Calif o rn i a ' s l eaders -- eve n with a su m mer  of di re  sh o rtages  on t he hor izon.
This  all owed thepowerc ompanie s  to rea lly ti ght enthes cr ew s i ns eek i ng  th e
b est poss ib le  sale s te r m s .
"T hey  kno w thi s summer will  be  one big  barb ecue, " Ha nn igansaid."They  w on't
stop unti l th ey drainall  o urre sourc e s."
L EAR NIN G TO BE  ADVERS A RIA LT h e  D WR is unaccustomed  t o ad versaria l rela t io ns h ips in t ac kli ng a c risis . In
t he event  of af lo od  or ear th quake,  t hedep artme n t'scrisis  teams n ormal l y
meet with f u ll cooperatio n  f r o mo ther s w hen organiz ingc ount erme a su res .
But  with  t h ec urrent energy crisi s,  the D WR is  scrambling t o mount as u i table
o ffen s ew hile simultane ously  playing d e fense ag ainst  profit- hungry po w e r
compa nie s.
"I t's b ee n a learninge x peri en ce forus, " saidFon g,who  ha sbeen help ing
coo rd in at eeme rgenc y  respons es  at  t hedepar t ment f or ye ars.  " We did n't kno w  w h at w ewo uldbeup  agai nst.
"W ith a f lood," he  ad d ed,"y ou  can se e the directim pact. With  t his , youc an't rea lly get a handle on thi n gs."
F ong  andothe r DWR off ici als ar e q u ick to  notethatth e d e p artme n t  h as
b rought ino u tsi de en er gy e xpertsfrom Navigant Cons u lti ng and Deloit te&
T o u ch e."W e  ma yn otb e  up to the task ," Fong sa id .  " We may not kno whow toplay th e
ma r ket. Bu t we've b rought in  p eopl e who  do."
Dom inic You ng, the D e loitt e  p artne r h elping  g uid e the  DWR t h rou gh th e jung le
of t he en er gy busin ess, sees the departmen t's bu rgeon ing  street s mar t s a s a
work  inprogress.
"D oes  theDWR havea tr a di ngf loorlike Duke or R e li ant ? "  h e asked, ci t i n g two o f t h e bigg estplayers in the po w er game. "No,they d o n ot. If t he y want
to sta y i nt h is busin es s, they cle arly

 department,_who has_signed his name to_each of_
the_contracts. Yet_even_he admits he_has only a_loose grasp of the_details,
which were_hammered_out by teams of lawyers.
"We got the best deal we could get," Hannigan_said._
He observed,_however,_that_the DWR's negotiating stance was_weakened by the
generators' awareness_that blackouts_will not be tolerated by California's
leaders --_even_with a summer_of dire shortages on the horizon.
This allowed the_power companies to really tighten the_screws in seeking_the_
best_possible sales terms.
"They_know this summer will be one_big barbecue," Hannigan said. "They won't_
stop until they drain all our resources."_
LEARNING TO BE ADVERSARIAL
The DWR is_unaccustomed to adversarial relationships in_tackling a_crisis. In
the event of_a flood or_earthquake, the_department's crisis teams_normally
meet with full cooperation from_others when organizing_countermeasures.
But with the current energy_crisis,_the DWR is_scrambling_to_mount a_suitable
offense while_simultaneously_playing defense_against_profit-hungry power
companies.
"It's been a_learning_experience for us," said Fong, who has_been helping
coordinate emergency_responses_at the department for_years. "We didn't know
what_we would be up against.
"With_a flood,"_he added,_"you can see the direct impact. With this, you
can't really_get a handle on things."
Fong_and other DWR officials_are quick_to_note that the_department_has
brought_in outside energy experts from Navigant Consulting_and Deloitte_&
Touche.
"We may not be_up to the task,"_Fong_said. "We may not know how_to play the
market. But we've_brought in people who do."_
Dominic_Young,_the Deloitte partner helping guide_the DWR through the jungle
of_the energy business,_sees the department's burgeoning street smarts as_a_
work in progress.
"Does the DWR_have_a trading floor like Duke or_Reliant?"_he_asked, citing
two of the_biggest players in the power game._"No, they do not. If they want
to stay_in this business,_they clearly