----- Forwarded by Jeff Dasovich/NA/Enron on 01/11/2001 07:55 PM -----

	"Julee Malinowski-Ball" <jmball@ns.net>
	01/11/2001 07:22 PM
	Please respond to "Julee Malinowski-Ball"
		 
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		 Subject: ECA Hearing Summary

The new Assembly Committee on Energy Costs and Availability.(ECA) met today
and heard two bills: ABX 5 (Keeley), relating to the ISO and PX governing
boards, and ABX 6 (Dutra/Pescetti), relating to utility retention of assets.
Both measures passed with only one dissenting vote on ABX 6 (Asm. John
Campbell).

Although ABX 5 passed in its current form, possible amendments to be taken
in the Senate would include:  increasing the number of governing board
members, increasing the length of the terms, and addressing the issue of
Governor appointees on the EOB confirming Governor appointees on the ISO and
PX.  Testifying in support of the measure were the Consumers Union, EOB,
CalPIRG, TURN, ORA and the California Utilities Employees.  The ISO
testified in opposition based on a past FERC letter which opposes an
appointed Board.

The ABX 6 debate was over the conflict in the Public Utilities Code
regarding utility asset retention (Sections 851 and 377).   The debate,
however, was not limited to this one point.  Asm. Leonard started the ball
rolling when he noted a problem when some generation in the state is
regulated (the utility generation) and some isn,t (the new generators).
This issue was picked up by Asms. Steinberg, Jackson, Oropeza, and Diaz, who
suggested that there may need to be legislation to regulate all the
generation in the state.  Asm. Wright did a good job pointing out that in
doing so, the state would have to offer generator owners something in return
the state isn,t able to afford.

When Loretta Lynch spoke in support of the bill she began with the Stage 3
alert, noting there was 15,000 megawatts off-line today and generators were
refusing to allow state inspectors into their plants.  Although the only
company she named was AES, she made every committee member believe it was
everyone.  In response to a question about long-term contracts, she said
that since August this CPUC has allowed it and the utilities are the ones
who refuse to enter into contracts.

Pete Conaty from labor repeated his statement that when the new generators
purchased these plants, they significantly reduced the labor force, ran the
plants harder than when the utilities ran them and that is why the plants
are breaking down.

Both measures will be debated on the Assembly floor next when they go into
session tomorrow morning.

Julee Malinowski-Ball
Senior Associate
Edson + Modsette
916-552-7070
FAX-552-7075
jmball@ns.net