Market Participants:

  The ISO has posted the following materials regarding CAISO's
Congestion Management Reform (CMR) Recommendation.

  Congestion Management Reform Recommendation (This is the
same as the version posted on July 11th with the exception that we have
corrected typographical errors.)

  Appendix A - Terminology and Acronyms A glossary of various
terms and acronyms used throughout the CMR Recommendation package.

  Appendix B - Locational Price Dispersion Study Summarizes
the areas of empirical study in which the ISO is currently engaged and
describes the objective, design, and preliminary results of the ISO's
analysis of the dispersion of locational prices throughout the ISO control
area.

  Appendix D - Assessment of CMR Design Recommendation with
Respect to Stakeholder Evaluation Criteria Compares the CMR Recommendation
against the specific evaluation criteria agreed to by the ISO and Market
Participants at the first stakeholder meetings.

  Appendix E - Congestion Management Redesign Options Not
Adopted in the CMR Recommendation

  Appendix G - System Impacts Summarizes the anticipated
impact of CMR Recommendation on the ISO's primary systems, such as SI/SA,
BBS, FTR, EMS, etc.  The purpose of this appendix is not to provide detailed
cost-benefit evaluation of the proposal, which we believe would be entirely
subjective and of little value.

  Appendix H - Intra-Zonal Congestion Management Mitigation
Costs During 1999  and Their Application to Local Reliability Areas.

  It is our intent to publicly distribute Appendix C, as
identified below, by mid August.  In the final draft of
  the recommendation package, to be publicly distributed and
provided to the Board in late August, we will
  provide the following additional appendices as well as
updated versions of those identified above.

  Appendix C - Market Separation Study The objectives, design,
and preliminary results of the other ongoing study being undertaken in
connection with the Congestion Management Reform process.

  Appendix F - Summary of Stakeholder Comments of California
ISO Congestion Management Proposals A summary of all stakeholder comments
received to date on the various proposals and concepts incorporated into
this recommendation package.

  You can find these Appendices along with the original
proposal and feedback form  at
http://www.caiso.com/clientserv/congestionreform.html.

  Byron Woertz
  Director, Client Relations