Dynegy has requested a meeting with us to discuss what an "Into Product" is 
and how this product works with what is currently going on with transmission 
and how it may be impacted by future changes in transmission.  Attendees from 
Dynegy will include Griff Jones (Dynegy's head of trading), Matt (whose last 
name I didn't get) and their lawyer Harlan Murphy.  If you think somebody 
else should attend or if you want them to come over here, let me know and I 
can talk to Harlan.  Assuming the meeting stays scheduled, I will schedule an 
internal meeting to briefly go over the EEI Into definition before we meet 
with Dynegy.

As you are aware, in connection with the EEI effort we worked extensively 
with a large group of industry participants to define  what an Into Product 
is.  Dynegy and PECO were the two companies that were very outspoken against 
they way the product ultimately got defined.  Dynegy put on a big dog and 
pony show before a large group of industry participants trying to argue that 
EEI's Into product was flawed.   Their position, while not completely 
expressed, hinges on the concept that if you sell an Into Product and are 
making deliveries on firm transmission, then the Seller will always be 
excused from performance if the firm transmission gets cut for any reason (in 
general, this is contrary to EEI which obligates the Seller to go to another 
interface unless the cut was due to Buyer's use of non firm transmission when 
firm was available or due to Buyer's attempt to move the energy away from the 
receiving control area).  Dynegy's approach was driven by the fact that they 
have extensive generation and that the vast majority of their deals go 
physical.  At the time, we suggested that if they were worried about cuts in 
firm transmission, then they needed to sell a transmission contingent 
product.  Dynegy's concept was rejected at the EEI meetings.

I hope that the meeting will accomplish the following goals:

1.  Get Dynegy to agree to trade Into with us under a common Into definition 
- Dynegy will not sign an EEI with us because of the Into definition.  We 
trade Into extensively with them, but clearly do not have a common 
understanding of what we are trading.  Critical to clear up this ambiguity.

2. Secure Dynegy as an advocate of EEI - Because Dynegy was so vocal against 
EEI's Into definition, if they now started using EEI, it would further boost 
acceptance of the contract and isolate PECO as the only other major voice 
against the Into definition.

3. Reexamine the Into Product as it is currently drafted and consider what 
will happen as access to transmission changes - Because the Into product is 
such an important part of East trading today, it is critical that internally 
we all agree how it should operate. Additionally, it is critical that we 
start thinking about how the Into product will be affected by changes in 
transmission, such as the advent of RTOs (with long term Into deals we may 
want to consider addressing what happens if the receiving control area goes 
into an RTO)

Call me with any questions/thoughts.

Thanks
Elizabeth
 36349