Jeff,

Per our discussions I am writing this note to formally request a regulatory 
opinion regarding the status and possible outcomes with respect to QF PPA 
restructuring in California.  As we discussed, ENA is currently conducting 
due diligence efforts on 2 California QF assets; Mt. Poso and Ace.  Both of 
these assets have SO4 PPAs.  Mt. Poso's is with PG&E and Ace's is with 
Edison.    By the time we acquire these assets, both will be receiving SRAC 
energy prices.  As part of this process, we need to be able to quantify (as 
best we can)  what impact  current PUC discussions will have on the switch 
from SRAC to PX.   Specifically we would like an opinion on the following:

1.) What is the projected timing for switching from SRAC to PX.  This can be 
in the form of a timing probability.  (ie. 50:50 in the next year, etc)

2.) Discussions are ongoing concerning what if any capacity payments are 
imbedded in the PX payments.  Based on what you know on how these discussions 
are moving forward, can you lay out a best case, worst case and most likely 
scenario.   A summary of the possible equation for calculating the new PX 
pricing would be helpful.

3.) You mentioned the possible transition from a transmission losses discount 
to a GMM adjustment.  Any comments you have on these discussions would be 
useful.

Any other comments you may have in regards to the above or the due diligence 
efforts in general would be appreciated.

 If you have any questions please call me at 503-464-3836.

Mike Etringer