There seems to be a fundamental issue which must be clarified among the TFG if we are to keep this proceeding manageable, and I'm afraid that the draft which has been circulated is heading in the wrong direction.  Portland General was of the opinion that ripple claims were to be deferred to a later date and not to be considered by the Judge at all in this phase of the proceeding.  Given the issues in this case regarding unlawful retroactivity, differences between the California and PNW market structure, and an unduly short timeframe in which to hold a hearing, there is no reason to start getting into the counter claim/cross claim morass unless and until the Judge and/or the Commission rules that refunds are required as a matter of law.  In that event, each member of the TFG (and for that matter, every party to the proceeding) has to have fully reserved its rights to file counter and cross-claims in order to seek compensation from any other party for liability which may have been ordered to the parties filing affirmative cases.

This approach does not mean that a party cannot defend itself in this phase against another party who makes an affirmative claim against it in the initial round of testimony .  Such party should be able to defend against not only the specific price, volume, etc. of the claim, but also should be able to respond with a counter-claim against the party initially claiming the refund in order to ascertain the net refund, if any, due the proponent.  Cross-claims can be deferred and are not necessary at this point.

Limiting the first phase in this manner should allow a record to be developed as to the net amount of refunds potentially due to those filing an affirmative case, but need not, at this point, develop cross-claims or start up the next "ripple."

Avoiding ripple claims to the greatest extent possible in the first phase of this proceeding would also answer the question of whether the parties could try to expand the bases for refunds, since the Judge (and/or Commission) would have already made rulings as to the definition of "spot market" and other parameters of a refund calculation.  We should be taking positions on all of these market structure issues in the testimony and filings we make now, and the resulting decisions will guide further phases.

This was Portland General's understanding of what the ripple stipulation was intended to reflect.  PGE does not support an approach which would greatly expand this phase of the proceeding to incorporate filings on ripple claims at the end of this month, and I'm not entirely sure that the current draft was intended to do that.  However, that is my reading of its effect.  Are others in agreement with the general approach outlined in this email or do we need to schedule a quick conference call to discuss/confirm the  principles and details of how we go forward?