Elizabeth:

Christi and I thought you should know about this development in New York 
regarding EnronOnline.  Please call me if you have any questions.

Sarah


----- Forwarded by Sarah Novosel/Corp/Enron on 04/05/2001 05:41 PM -----

	Sarah Novosel
	04/05/2001 01:37 PM
		 
		 To: Donna Fulton/Corp/Enron@ENRON
		 cc: 
		 Subject: Re: NYPSC Adopts Enron Online as Index


----- Forwarded by Sarah Novosel/Corp/Enron on 04/05/2001 01:37 PM -----

	Louise Kitchen@ECT
	04/05/2001 11:31 AM
		
		 To: James D Steffes/NA/Enron@ENRON
		 cc: Lisa Yoho/NA/Enron@Enron, John J Lavorato/Enron@EnronXGate@ENRON, Andy 
Zipper/Enron@EnronXGate, Howard Fromer/NA/Enron@Enron, Richard 
Shapiro/NA/Enron@Enron, Sarah Novosel/Corp/Enron@ENRON
		 Subject: Re: NYPSC Adopts Enron Online as Index

Andy is back now so this is all over to him.  There are lots of issues to 
consider in how all of this moves forward.  Let's just make sure Howard keeps 
Andy in the loop on this as the traders are not expected to understand the 
trading framework of EOL.

Thanks

Louise




James D Steffes@ENRON
04/05/2001 10:26 AM
To: Louise Kitchen/HOU/ECT@ECT
cc: Lisa Yoho/NA/Enron@Enron, John J Lavorato/Enron@EnronXGate, Andy 
Zipper/Enron@EnronXGate@ECT, Howard Fromer/NA/Enron@Enron, Richard 
Shapiro/NA/Enron@Enron, Sarah Novosel/Corp/Enron@ENRON 

Subject: Re: NYPSC Adopts Enron Online as Index  

Louise --

Government Affairs was not pushing for this outcome.  The NY PSC seems to 
have adopted this on their own (or with the support of the local utility).   
Howard Fromer (our NY reg affairs guy) indicates that the NY PSC was simply 
looking for a deep market index they could use to establish "non-switching" 
customer rates.  Howard has spoken with Dana Davis about publishing off-peak 
and on-peak prices and he said that the Desk could do it.

One other thing.  PGE is looking to transact with EPMI through EOL.  We are 
preparing a filing at FERC that would modify PGE's Code of Conduct to allow 
this.  There is a risk that FERC will use this filing (while small) to look 
again at "regulating" EOL.  Remember that APX is regulated by FERC.

I agree that we need to be more coordinated with EOL and state regulators 
(FERC is in the loop and we have had discussions with them).  

Of course, as our involvement in the markets through EOL continues to grow, 
regulators will begin to take a deeper look.

Lisa Yoho and I can come by today to discuss more fully if you'd like.

Jim





Louise Kitchen@ECT
04/05/2001 09:01 AM
To: James D Steffes/NA/Enron@ENRON
cc: Lisa Yoho/NA/Enron@Enron, John J Lavorato/Enron@EnronXGate@ENRON, Andy 
Zipper/Enron@EnronXGate 

Subject: Re: NYPSC Adopts Enron Online as Index  

Have we had any interaction with them on this?  This is not good news at all 
(as indicated below) and has regulatory implications for EnronOnline - I 
presume we did not encourage this in any way or have any agreement in place.  

Did we have any involvement in the process at all or is this something one of 
your guys picked up - Anyway Andy Zipper is back today so I am sure he will 
handle this.

Physically they cannot get the prices and we don't (I think) publish power 
indices on EOL. 

I hope we haven't been the people pushing this as that would be a real 
problem and shows immense lack of co-ordination.

Louise




James D Steffes@ENRON
04/04/2001 06:51 PM
To: Louise Kitchen/HOU/ECT@ECT, Lisa Yoho/NA/Enron@Enron, John J 
Lavorato/Enron@EnronXGate
cc:  

Subject: NYPSC Adopts Enron Online as Index

Not sure if you had seen this language from the NY PSC.  While great, this 
clearly means that NY PSC commissioners will begin to think alot about how 
EOL  and its relationships with other Enron companies.

Jim

---------------------- Forwarded by James D Steffes/NA/Enron on 04/04/2001 
06:49 PM ---------------------------
From: Howard Fromer on 04/02/2001 04:38 PM
To: Jeffery Ader/HOU/ECT@ECT, Michael Brown/Enron@EnronXGate, Mark Dana 
Davis/HOU/ECT@ECT, Tom Dutta/HOU/ECT@ECT, John D Suarez/HOU/ECT@ECT, Doug 
Sewell/HOU/ECT@ECT, Richard Ring/HOU/EES@EES, Charles Decker/HOU/EES@EES, 
Gary Keevill/ECP/Enron@Enron, John Llodra/Corp/Enron@ENRON, Tom 
May/Corp/Enron@Enron, Pearce W Hammond/Enron@EnronXGate, Christi L 
Nicolay/HOU/ECT@ECT, Sarah Novosel/Corp/Enron@ENRON, Dan Staines/HOU/ECT@ECT, 
W David Duran/HOU/ECT@ECT, Richard Lydecker/Corp/Enron@Enron, Steve 
Montovano/NA/Enron@Enron, James D Steffes/NA/Enron@Enron, Janelle 
Scheuer/Enron@EnronXGate, Rick Bachmeier/HOU/EES@EES, Lance 
Hinrichs/HOU/EES@EES, Jim Meyn/NA/Enron@Enron, Berney C Aucoin/HOU/ECT@ECT, 
Richard Shapiro/NA/Enron@Enron, Patricia Collins/HOU/EES@EES, Fatimata 
Liamidi/HOU/EES@EES, Dag Joraholmen/HOU/EES@EES, Dwight Fruge/HOU/EES@EES, 
John Campbell/HOU/EES@EES
cc:  

Subject: NYPSC approves market-based backout credit for RG&E; Adopts Enron 
Online as Index

Another big victory for Enron in New York! In an Order issued by the NYPSC on 
March 29, the NYPSC has approved a proposal to modify the existing fixed 
backout credit of 2.8 cents per kwh for energy and capacity and replace it 
with a market-based backout credit. The additional retail adder of 0.4 cents 
per kwh would remain.  Load-serving entities (LSEs) will have the option of 
continuing to buy their energy and capacity from RG&E at the market based 
backout credit which will be determined 15 days prior to the beginning of 
each of the two six-month capability periods, and will be based on "a 
forecast of energy prices derived from Enron Corporation's (Enron) 
EnronOnline trading platform."  To my knowledge, this is the first occasion 
that a regulatory body has agreed to use Enron Online as an index!  LSEs can 
elect instead to procure their own commodity and get a market-based backout 
credit (MBBC). Under this option, the LSEs will get a market based backout 
credit. However, the Enron online prices for the six months determined as 
above will be reconciled on a lag basis against actual market prices.  The 
PSC has capped the amount of the reconciliation for any LSE to the product of 
the LSE's total load for the calendar year and $0.065 per kwh (PSC staff's 
estimate of RG&E's embedded power supply cost).  (The PSC Order actually says 
$0.015 but this appears to be a mistake since the attached settlement states 
$0.065.) A copy of the PSC's Order is available on its website:  
www.dps.state.ny.us