FYI - Paul agreed with my suggestions. 
----- Forwarded by Aleck Dadson/TOR/ECT on 06/22/2001 05:27 PM -----


	Aleck Dadson 06/22/2001 05:03 PM 	  To: Rob Milnthorp/ENRON@enronXgate@ENRON  cc: Garrett Tripp/TOR/ECT@ECT@ENRON, Paul Devries/TOR/ECT@ECT@ENRON  Subject: Re: Market Opening 	



	
With respect to point 1 in your  memo, my sense is that the counterparty would have to be either OPG or OEFC.  In my view, the concept would not/could not  go forward and be implemented unless it had the support of OPG.  The question we should talk through  is how do we best try to get that support from OPG. 																																							With respect to point 2, I think we should be careful about being  too encouraged by Wilson's /Purchase's comments  to Lay/Lavorato on June 19 that if positive reports are delivered by the IMO and OEB in September, the gov't  will be hard pressed not to move forward.  My concern is that Wilson and Purchase may feel comfortable saying this precisely because they are expecting a negative report from the OEB (or at least one that they can interpret as being negative). I agree with you that the likelihood of the IMO delivering a positive report is very good. The likelihood of a positive report from the OEB is far less certain. The key issues  at the OEB/retail level are EBT, LDC access to the data they need from HydroOne, completion of LDC CIS systems,  the gov't's interest in an industry resolution of  customer duplications prior to market opening in order to avoid mass confusion in the initial period of the market, the  state of customer education, and a contingency plan to accommodate those who are not ready.  																														- with respect to EBT, I think the best we can do is get onside quickly with our  EBT hub of choice  and work with them on perceived difficulties 		with LDCs, etc.  Ellis, Marryott and I are going to make a recommendation to Paul next week on our preferred EBT hub.  																								-with respect to the info from HydroOne, I  have already raised this issue with the OEB and the IMO. The OEB and the IMO subsequently met with 		HydroOne and the MEA in an effort to resolve this issue.  My understanding, until yesterday's discussion with Conway, was that the issue was resolved 	and the information was now flowing to the LDCs. Paul, Garrett  and I are meeting senior HydroOne execs (including Rod Taylor) on Monday re     		resource adequacy issues and we can press this with them as well. 																														- with respect to the CIS issue, there is not much we can do since most  LDCs already have a CIS vendor; but my understanding is that at least 		one CIS vendor has backed out of its commitments to a number of LDCs recently (per David MacFadden) and perhaps we can get a vendor 		to move in quickly to fill that gap. I will raise this with Marryott to see what may be feasible at this stage. 																										- with respect to the customer duplication issue, I have already met with the senior people at Direct (last week)  to discuss this issue with them and to 	propose a resolution that would see the retailers involved retaining a third party  (such as E&Y)  to assess the degree of overlap and whether 		there was an acceptable solution to any problem. Direct is convinced that the degree of duplication is not high.  Direct is talking to Onsource 		and Toronto about this. 	I am checking with our staff in the UK about whether there was a similar issue when the UK market opened and, if so, how it was 	resolved. . 																																					-with respect to customer education, I and Dick Perdue (Direct's advisor) have contacted TransAlta, OPG, HydroOne, Onsource, Enersource, 		and Toronto about funding a  Province- wide consumer education initiative over the summer.  We are meeting next week to discuss this idea 		 further.  This could require a financial commitment from Enron of  up to $200,000. 																													- with respect to the contingency plan to deal with those LDCs who are not ready, the OEB is already on side in recognizing the need for a contingency 	plan - it will likely be very simple: the IMO  would send a bill to the LDC each month and the LDC would bill customers at some fixed rate, with a deferral 	account). The key  issue will be how many LDCs (in terms of numbers and size)  are not ready and what is the minimum number of LDCs that 		the OEB/gov't is looking for to be ready. This is an issue we will have to talk to the MEST about as well as the OEB	, since ultimately the 			decision of whether enough LDCs are ready will be a political one.																													These are the OEB/retail focussed things we are doing.  On the  larger political front, I have several  ideas about some things  I would like to do that I can discuss with you and Paul. 																																																				




	Rob Milnthorp/ENRON@enronXgate 06/22/2001 11:13 AM 	   To: Paul Devries/TOR/ECT@ECT, Garrett Tripp/TOR/ECT@ECT  cc: Aleck Dadson/TOR/ECT@ECT  Subject: Market Opening	



Garrett/Paul - Can you guys work with the North East desk to price out a 500MW option at the New York/Ontario intertie as an insurance policy for the Ontario government re market opening. You will recall that this was something we had suggested a while back and didnt receive much support. However, following Lavorato's meeting with Harris, Lavo is adamant that we send a term sheet to Harris directly outlining both an call option structure and a swap structure. 

Second, it is quite apparant to me that everything hinges on the September readiness report. If its favorable, I think there is a good chance of a fall market opening. With that said however, we are in the hands of the IMO and the OEB. I'm comfortable that we can continue to influence the IMO to produce a favorable announcement but I dont know what we can do to ensure that the OEB says its ready. Any suggestions, comments? I dont want to be in a position that one LDC  could halt market opening. 

Regards
Rob






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