Can we sell them Pastoria or do we have to sell them the power from us.

 -----Original Message-----
From: 	Calger, Christopher  
Sent:	Thursday, February 08, 2001 11:24 AM
To:	Delainey, David; Kean, Steven; Lavorato, John; Dasovich, Jeff
Subject:	CDWR Update

Gentlemen:

I have spoken with CDWR several times since we submitted our proposal.  They are immediately interested in a 5 year power sale and then want to discuss Pastoria.  I updated a price for Freeman for 200MW Peak SP-15 5 Year ($124/MWh).  I also spoke with their lawyers a couple of times to start trading comments.  I volunteered to send a team to LA today or tomorrow, but so far they prefer to discuss by phone.   Their lawyers acknowledge that the primary issue for suppliers is credit.  They are working on an agreement with CPUC that would ensure that CDWR would have an adequate revenue stream to support the contracts.  Their intent is to make the supply contracts have priority over the bonds.  Until that happens, we maintain that we require a cash prepayment or letter of credit to support any deal.  I expect to hear from them again later today.  I will keep you posted.

Regards,

Chris