I strongly disagree

"If it is impossible to reach an agreement within ABRADEE",, then we should 
be loud an clear in expressing our own view, to all levels of government 
including a position paper to  Pedro Parente asap.  Caps at this point in 
time may jeopardize the rationing plan per se. We had a victory in anchoring 
the penalties to the MAE price. Why surrender it now? 

Why do we have to abide by ABRADEE's desires? 

This is not a religious issue only.  There are a few US$ million left on the 
table.

How many US$ million are on the table for Enron?

 - Ballpark, possibly  US$20f or Elektro's long position  (60 in EBITDA * 
(680-460)/680)
 - A lot, lot more for Eletrobolt (perhaps to the point of killing the 
project, as Joao Albuquerque stated)

Are we being consistent? About a week ago, we submitted our views to ANEEL, 
on Public Hearing 02/2001, advocating for an increase in the cost of defict 
to US$ 2350/MWh. The trading group (Remi, David) were adamant about this 
position submitted by Regulatory Affairs (I think they are right) 

Are we acting to the best interest of our shareholders? 



LM





Joao Carlos Albuquerque
05/20/2001 11:40 AM
To: jmazon@elektro.com.br, Orlando Gonzalez/SA/Enron@Enron, Sergio 
Assad/SA/Enron@Enron, Luiz Maurer/SA/Enron@Enron, Fred Sampaio/SA/Enron@Enron
cc: Britaldo Soares/SA/Enron@Enron, Brett R Wiggs/SA/Enron@Enron 

Subject: CAP no MAE

Algumas empresas de distribui??o short em 02 e 03 est?o defendendo fortememte 
CAP no MAE,  bem abaixo do custo do d,ficit ( cerca de R$ 680). ( CERJ, 
Cataguases, LIght est? em cima do muro, etc...)

Se for inevit?vel, nossa posi??o deve ser:

 - N?O PODE SER INFERIOR AO PRE_O PRATICADO NO PRE-RACIONAMENTO ( R$ 460,00 )
 - N?O PODE SER INFERIOR ? MAIOR TARIFA COBRADA DOS CONSUMIDORES  ( TROS 
VEZES A TARIFA RESIDENCIAL  ATUAL - 200% SOBRE A MESMA, PARA CONSUMOS ACIMA 
DE 500 KWh POR MOS) . 

Mazzon, calcule a ordem de grandeza deste valor. _ importante termos isto em 
mente quando formos falar com as autoridades amanh? e, em especial com Mauro 
Arce.

Lembrar, ainda, que um CAP baixo, sem FLOOR, pode matar ELETROBOLT, uma vez 
que as receitas que esta auferiria em 2002 n?o compensariam o decr,scimo das 
mesmas de 2003 em diante, quando, com a redu??o de mercado devido ao 
racionamento e o aumento de entrada de novas fontes de gera??o, tamb,m 
incentivada pelo racionamento, poder? derrubar fortemente os pre?os do MAE. 
N?o devemos nos esquecer que o per?odo de amortiza??o de ELETROBOLT , de 
cinco anos.

Jo?o Carlos