This may not pertain to everyone.  However, in the interest of 
over-communicating rather than under-communicating, please read the following.
---------------------- Forwarded by Tim Belden/HOU/ECT on 11/01/2000 08:48 AM 
---------------------------
From: Tim Belden on 11/01/2000 09:41 AM
To: Mike Swerzbin/HOU/ECT@ECT, Robert Badeer/HOU/ECT@ECT, Sean 
Crandall/PDX/ECT@ECT, Tim Belden/HOU/ECT@ECT, Jeff Richter/HOU/ECT@ECT, Diana 
Scholtes/HOU/ECT@ECT, Tom Alonso/PDX/ECT@ECT, Mark Fischer/PDX/ECT@ECT, John 
M Forney/HOU/ECT@ECT, Paul Choi/SF/ECT@ECT, John Malowney/HOU/ECT@ECT, Holli 
Krebs/HOU/ECT@ECT, Greg Wolfe/HOU/ECT@ECT, Chris H Foster/HOU/ECT@ECT, 
Stewart Rosman/HOU/ECT@ECT, Kim Ward/HOU/ECT@ECT, Debra Davidson/PDX/ECT@ECT, 
Tim Belden/HOU/ECT@ECT, Lester Rawson/PDX/ECT@ECT
cc: Monica Lande/PDX/ECT@ECT, Valarie Sabo/PDX/ECT@ECT, Fran 
Chang/PDX/ECT@ECT 
Subject: Communicating with Risk

A couple of things happened yesterday where communicating with our risk team 
could have saved them a lot of time.  I have asked the risk group to put 
together a list of things they need to know from us each day;  until we 
distribute the definitive list, this e-mail should serve as a reminder that 
more communication is much better than less.

First, you need to hear about how a simple little thing can cause our risk 
systems to blow up.  My goal is not to point a finger, but rather to 
highlight the fact that we need to be thinking about the risk group any time 
we change something in Enpower.  Yesterday, somebody on the short term 
california desk entered a 1 MW deal for 1 hour with the wrong delivery 
point.  The delivery point was somewhere in the eastern US.  The deal was 
promptly changed, but not before the east desk had "calced" their books.  
When the west risk group attempted to "calc" our books, the system found a 
deal (the same 1 MW deal) that had already been "calced" by the east.  The 
result was that the portcalc blew up and there was no way to know why.  The 
technology group in Houston worked through the night to figure it out.  Our 
risk group was here until about 11 PM trying to figure it out.  Finally, the 
problem was discovered this morning.  The result was that we didn't publish a 
preliminary P&L last night and we didn't have correct positions this 
morning.  On top of that, people who are already overworked had to put in 
long hours.  IN THE FUTURE, IT IS YOUR JOB TO COMMUNICATE INFORMATION -- 
LARGE OR SMALL -- TO THE RISK GROUP.  It is impossible to know what types of 
things may cause problems.  Therefore, I can't prescribe exactly what has to 
be communicated.  Obviously, you don't need to tell them about every deal 
that you have entered, but you need to tell them about any changes to deals.  
Try to communicate too much.  Let them tell you when it is too much 
information.

Another area of communication that must be improved concerns long term 
deals.  The interest rate group needs to know about material changes in cash 
flows in the future.  Our risk group currently communicates this information 
to the interest rate group.  If we don't tell them, they can't tell the 
interest rate group, and the interest rate group yells at our risk group.  
Nobody likes to get yelled at.  Yesterday, we did a couple of long term deals 
with BPA in the 2002 to 2006 timeframe.  Nobody on the desk communicated this 
to the risk group.  In the future, please communicate any deal that is longer 
than a year to the risk group.

Again, my goal is not to chastise the people who caused the problems 
yesterday.  We had no idea that changing a small deal could blow up our 
system.  But going forward, I am going to be really mad if our lack of 
internal communication leads to uneccessary work and/or headaches for others 
on the floor.  All of our lives will be much better if we communicate more.

Thanks for your attention to this matter,
Tim