REVISED MARKET NOTICE from July 6, 2001 @ 11:16AM
Summer Reliability Contract Capacity Payment/Charge
Charge Type 1120 (Estimate) and 
Charge Type 1121 (Actual)

ISO Market Participants:
SC Settlement Contacts:
The California Independent System Operator has contracted for peaking
generation through the Summer Reliability Agreements (SRA) to assist in
meeting reliability needs this summer.  On March 30th, 2001 the ISO
Governing Board directed Management to recover costs incurred under the
Summer Reliability Agreements as provided in the ISO Tariff Section
2.3.5.1.8.  (i.e.: "all costs incurred by the ISO ... shall be charged to
each Scheduling Coordinator pro rata based upon the same proportion as the
Scheduling Coordinator's metered hourly Demand (including exports) bears to
the total metered hourly Demand (including exports) served in that hour.") 

The SRAs require the ISO to make the monthly fixed capacity payments in each
summer month (June through October) and then true-up the penalties and
offsets in the last month. Two facilities with SRAs reached Commercial
Operation by June 15th, 2001and therefore became eligible to extend their
SRA, day for day, into November 2001. 

The ISO will allocate these charges in two phases based on two new Charge
Types, "Estimated Summer Reliability Contract Capacity Payment/Charge (CT
1120)," and "Actual Summer Reliability Contract Capacity Payment/Charge (CT
1121)".  To accomplish this, the ISO will allocate an estimated charge,
based on the previous month's metered Demand and exports (CT1120).   Then,
in the following month, the entire estimated charge (CT1120) will be
reversed and the Scheduling Coordinator will be charged the actual amount
based on actual metered Demand (including exports) (CT1121).  An example of
the allocation process is as follows:

1.	The ISO will allocate the SRA amounts to the Market by applying CT
1120 (Estimated Summer Reliability Contract Capacity Payment/Charge) on the
Preliminary statement for the last day of the Trade Month preceding the
Trade Month for which payment is due. The estimated charges for SRA costs
(CT 1120) applicable to Trade Month June 2001 will be applied to the
Preliminary Statement for Trade Day May 31, 2001.  The ISO estimate will be
based on the Market Participant's metered hourly Demand and exports from the
prior month (in this example, the metered hourly Demand and exports for May,
2001). Charges for CT 1120 will also show up on the Final Statement for
Trade Date 5/31/01.  

2.	The ISO will then recalculate the allocation of the SRA amounts
through Charge Type 1121 (Actual Summer Reliability Contract Capacity
Payment/Charge) based on the Market Participant's actual metered hourly
Demand and exports for the appropriate Trade Month.  Actual (CT 1121)
charges will appear on the Final Statement for the last day of each actual
billing month.  (In the foregoing example, the charges would appear on the
Final Statement for Trade Date 6/30/01.)  As CT 1121 appears on the Final
Statement, CT1120 will be reversed in its entirety (e.g., the 6/30/01 Final
Statement will include a reversal of the 5/31/01 estimate)  The reversal can
be identified by the Trade Date for the previous month and it will have the
opposite dollar value as the previous month.  

3.	Additionally, at the end of each SRA Summer Period, the SRA amounts
are recalculated to include penalties and offsets.  The Actual Summer
Reliability Contract Capacity Payment/Charge (CT 1121) will be adjusted
after the owner of the facility with the SRA has received the final market
settlement for the Summer Period.

The first SRA charge (CT 1120, estimated charge) will be for the June 2001
SRA payment and will appear on the Preliminary Statement for Trade Date May
31, 2001.  This Preliminary Statement will publish on July 25, 2001.
Adjustments for June 2001 through CT 1121 (based on Actual metered hourly
Demand and exports in June) will appear on the Final Statement for Trade
Date 6/30/01, which will be published on September 12, 2001.

CT 1120 and CT 1121 will be manual charge types within the Manual Line Item
Records.  Thus, no structural changes will occur in the Specification for
Settlement Statement Files, Version 13.1 and you should not need to make any
changes in your own systems.  Finally, as this is a new process it will
remain under review and may be subject to refinement.

Should you have questions, please contact your ISO Client Relations Account
Manager.

	Client Relations Communication
      CRCommunications@caiso.com