-----Original Message-----
From: 	"Meier, Peter" <peter.meier@neg.pge.com>@ENRON  
Sent:	Wednesday, November 21, 2001 1:08 PM
To:	Boomer, John; Massey II, John; Woods, Trevor
Cc:	Arcone, Anthony; Hein, Jennifer; Meier, Peter
Subject:	Texas Certified DERCs


	Gentlemen:

By a series of communications, the parties have stated their views
concerning the purchase and sale of 250 Texas NOx Certified Discreet
Emission Reduction Credits ("Certified DERCs").  PG&E Energy Trading -
Power, L.P. has carefully reviewed the file and our final position is set
forth below.

PGET was interested in purchasing Certified DERCs for immediate delivery.
These terms were critical to us, we conveyed them to the broker and we
consistently stated them to Enron.  Enron has failed to tender a contract
reflecting these terms and has repudiated any obligation to deliver Certifed
DERCs on this basis.  PGET has no obligation to purchase (and will not
purchase) the "registered" emissions reductions credits which Enron claims
it sold to PGET, nor will PGET stand by while Enron seeks to obtain
Certified DERCs.  We consider this matter closed, whether as a result of
your breach of contract or because the parties failed to reach agreement ab
initio.

	Regards,

	Peter Meier, Associate General Counsel
	301-280-6817


PG&E National Energy Group and any other
company referenced herein that uses the PG&E name or
logo are not the same company as Pacific Gas and
Electric Company, the regulated California utility.  Neither
PG&E National Energy Group nor these other
referenced companies are regulated by the California Public
Utilities Commission.  Customers of Pacific Gas and Electric Company
do not have to buy products from these companies in order
to continue to receive quality regulated services from the utility.