Ron,

Thanks for forwarding the DJ article.

I believe that the proposed DSTAR delay is neither surprising nor
unreasonable.  It was always ridiculous to think that the DSTAR Board
would be able to put togethers a complete FERC filing by 12/29/00, so
the 3-month delay on the tariff filing is OK.  The Board seems VERY
committed to making that filing.

As to the start-up date: it was always ridiciulous to believe that the
entire software and hardware system (new EMS, all market software, etc.)
could be put into place by 12/01.  The 12/02 date is, in my opinion,
both aggressive and achievable.

One thing to keep in mind as to the FERC filing: DSTAR already exists.
DSTAR is operated by an independent Board, not by the transmission
owners. That's already a big improvement over the other would-be RTOs.
(On the other hand, the transmission owners have not yet agreed to sign
onto DSTAR by signing a TCA... but I believe that this will happen.
What is CRITICAL is for FERC to respond to the 10/16/99 RTO filings by
DEMANDING that the final RTO filings include RTO authority over ALL
FERC-jurisdictional sevices, including interconnection at every voltage
level.  If FERC does this, the utilities will fall in line.  On the
other hand, if FERC doesn't take a hard line, there will be big debates
and we may end up with sham RTOs.)

Another thing to keep in mind (as to implementation): DSTAR's plan is to
consolidate control areas (from about six down to one).  This requires
more in the way of implementation effort than those RTOs which propose
to allow existing control areas to continue to exist.

Carl
____________________

Ronald Carroll wrote:
>
> Subject: DJ Desert STAR -2: Sees Need To Delay Start Up One Year
> Date: Wed, 20 Dec 2000 07:27:23 -0600
> From: "Tracey Bradley" <tbradley@bracepatt.com>
> CC: "Paul Fox" <pfox@bracepatt.com>,
>      "Ronald Carroll" <rcarroll@bracepatt.com>
>
> DJ Desert STAR -2: Sees Need To Delay Start Up One Year
> Copyright , 2000 Dow Jones & Company, Inc.
>
> The six FERC jurisdictional utilities included in Desert STAR are: Arizona 
Public Service Co., a unit of Pinnacle West Capital Corp. (PNW); El Paso 
Electric Co. (EE); Public Service Co. of New Mexico (PNM); Tucson Electric 
Power, a subsidiary of UniSource Energy Corp. (UNS); Public Service Co. of 
Colorado, a unit of Xcel Energy Inc. (XEL); and Texas-New Mexico Power Co., 
now privately held.
>
> Raezer said the board decided last week that the group isn't prepared to 
make the filing at this time.
>
>      While FERC may not be pleased with the delay, "we believe it is better 
to have a good filing that everyone agrees with than a bunch of pieces of a 
filing," Raezer said.
>
>      To help the stakeholders move forward on the grid price issue, Raezer 
said Desert STAR's transmission owners have agreed to meet to try to come up 
with a rate proposal to present to the other parties.
>
>      "Folks realize at some point we've got to make a decision that not 
everyone will be happy with," Raezer said.
>
>      Establishing a rate design has been difficult for Desert STAR members 
because half the transmission facilities in the region are owned by federal 
power marketing agencies, tax-exempt utilities and cooperatives that aren't 
subject to FERC jurisdiction, Raezer said.
>
>      And current rates differ dramatically, according to a draft letter 
from Desert STAR to FERC.
>
>      However, the jurisdictional utilities and the Salt River Project 
Agricultural Improvement and Power District have made a transmission rate 
design proposal "that requires further development and discussion," according 
to the draft letter.
>
>      Although FERC set a Dec. 15, 2001, startup date for these independent 
organizations to take control of the nation's high-voltage grid under Order 
2000, Desert STAR said it will need another year to acquire and test 
information system sofware and hardware and to train operators and market 
participants.
>
>      Raezer said he has heard that other RTO groups have expressed similar 
requests for more time to become operational with the FERC staff.
>
>      "What the commission will say, we don't know," Raezer said.
>
>      The Desert STAR board also heard from stakeholders on a number of 
issues it had hoped to resolve at its November meeting.
>
>      Raezer said the board agreed to revisit some issues if alternative 
proposals from all stakeholders are made.
>
>      "It's like peeling an onion," said Raezer. "You make one decision and 
four or five questions come up."
>
>      Desert STAR's October filing said the unresovled issues. like pricing, 
are critical "if the participation of the non-jurisdictinoal transmission 
owners is to be achieved."
>
>      Separating control of the nation's electric grid from the companies 
that own generation is viewed as critical in the shift to a competitive 
electric market.
>
>      Those Desert STAR transmission owners not under FERC control include: 
Arizona Electric Power Cooperative, Salt River Project, Plains Electric 
Generating and Transmission Cooperative of New Mexico and a large number of 
water and irrigation districts and municipal utilities.
>
>      Desert STAR has been in formation since early 1997.
>
>      -By Eileen O'Grady, Dow Jones Newswires; 713-547-9213; 
mailto:eileen.ogrady@dowjones.com
>
>      (END) Dow Jones Newswires 19-12-00
>
>      2237GMT