John,

I'm an analyst in the Generation Investments group, and we spoke regarding 
the Navy Yard transport curves about a month ago.

I am assuming there is probably no change in the applicable transport curves, 
but I just wanted to verify that there are no updates.

I have attached our past letters of correspondence regarding your suggestions 
for marking our transport expenses for the project.

Thanks,
Greg





Ying Liu@ENRON
03/07/2001 08:59 AM
To: Greg Martin/HOU/ECT@ECT
cc:  
Subject: Re: Brooklyn Navy Yard Project Transportation Curves Request


---------------------- Forwarded by Ying Liu/NA/Enron on 03/07/2001 09:05 AM 
---------------------------


John Hodge
03/05/2001 01:33 PM
To: Ying Liu/NA/Enron@ENRON
cc: Ruth Concannon/HOU/ECT@ECT 

Subject: Re: Brooklyn Navy Yard Project Transportation Curves Request  

Attached is a spreadsheet that details the transportation charges that you 
requested.  I recommend escalating the Iroquois and Transco charges in the 
same way as was done previously.  Escalate 18% of the Iroquois rates at the 
GDP inflator and 36% of the Transco rates.  This will take into account the 
pipeline's O&M cost increases.  TCPL is a different case.  Since we last 
looked at the Brooklyn Naval Yard assets, TransCanada has negotiated a 
settlement with its customers.  These are the rates that begin in 1/1/2002 on 
the spreadsheet.  However, TCPL is experiencing an inordinate amount of 
capacity turnback.  As their customer's contracts expire, the customers are 
not renewing.  This shoves their rate base on fewer and fewer customers and 
should increase their rates more quickly.  The next large customer turnback 
should occur in 2003.  For this reason, I recommend escalating TCPL's rates 
by 20% in 2003 and then escalating the entire rate by the GDP in the future.  
This should not only take into account the capacity turnback, but also 
consider the escalation in O&M costs.  Call me if you have any questions.





Ying Liu
03/01/2001 11:54 AM
To: John Hodge/Corp/Enron@ENRON
cc: William Keeney/HOU/ECT@ECT 

Subject: Brooklyn Navy Yard Project Transportation Curves Request

Hi, John,

Following up my phone call, I am sending a list of curve requests for you on 
the BNY project:

Base Year: 2001

1. Trans Canada:
  Demand Charges
 Variable Charges
 Fuel Requirement 
 Estimation of Trariff escalation  
2. Iroquois:
  Demand Charges
 Variable Charges
 Fuel Requirement 
 Estimation of Trariff escalation 
 3. Transco Z1 - Z6:
  Demand Charges
 Variable Charges
 Fuel Requirement 
 Estimation of Trariff escalation  

On the Tariff escalation part, based on your inputs, we used 22%, 18%, and 
36% of GDP inflation for TransCanada, Iroquois and Transco, respectively.  
Also, you estimated % increase in Transco Tariff from 2001 to 2007.  

Thanks a lot for your help!

Ying 
X57350