To the Core Aggregator Group:

As you know, SoCalGas filed its formal gas industry restructuring settlement
agreement with the CPUC yesterday (April 17).  Over the past two weeks, the
core aggregator group worked extensively with SoCalGas and the other
settlement parties to make sure that the settlement language tracked the
agreed upon principles that were included in the "term sheet"  that was
filed with the CPUC on April 3.  Based upon my review of the document, I
believe that the settlement agreement fairly reflects the deal that we
reached with SoCalGas.

The CPUC's Presiding Judge in the case - - Andrea Biren - - has established
the procedural schedule for an evidentiary hearing in this proceeding.
Under this schedule, prepared direct testimony (in support of the
settlement) is due to be submitted by May 5.  Rebuttal testimony (opposing
the competing settlement that was filed by SCGC and TURN) is due to be
submitted by May 19.  The hearing will begin on May 30.

In discussions with SoCalGas and the other settlement parties, it was agreed
that all of the industry groups that have participated in the SoCalGas
settlement should present testimony in support of the settlement.  This
means that the core aggregator group (or individual members of the group)
should present one or more witnesses who can testify to the benefits that
the settlement will provide to the core aggregation program.  This effort
must commence immediately in order to achieve a May 5 deadline.

I believe that it would be efficient for the core aggregator group (SPURR,
REMAC, CUB, Greenmountain.com, utility.com, United Gas, Enron, TXU, Shell
Energy Services) to jointly sponsor a single witness to testify concerning
all the benefits of the settlement for the core aggregation program.  This
testimony would address the following features:

* Core interstate unbundling
* Core storage unbundling
* Unbundled (daily) balancing for core customers
* Unbundled core backbone transmission
* Avoided cost billing credits (and process to redetermine)
* Core brokerage fee (and process to reconsider role of utility's core
procurement department)
* Elimination of the cap on core customer participation in core
aggregation, and reduction of the threshold for core aggregation groups
* Elimination of core subscription gas sales option

If a witness is to be engaged by the group, this will need to be done very
soon.  In addition, if the group wants to have one attorney
representing the group, this also should be decided very soon.
Alternateively, individual core aggregators may prefer to proceed on their
own.

I estimate that the fees for an outside expert witness to testify on the
above-referenced matters would be approximately $9,900.  This
estimate is based upon an hourly rate of $180.00, and an estimate of 55
hours, as follows:

  Activity
Hours

 Draft prepared testimony and      25
 (possibly) rebuttal testimony

 Prepare for hearings, including      20
 responses to discovery requests
 and mock cross-examination

 Hearing time        10
 ________________________
_____

      TOTAL:        55
Hours


At $180 per hour, the expert witness fees would be $9,900.  This does not
include "costs".

Our group should discuss, at the earliest possible time, how to proceed with
the presentation of prepared testimony.  Please respond
promptly to this e-mail and provide your availability for a conference call
within the next two days to discuss this matter.

Thank you for your attention to his request.

- John Leslie




**************

CONFIDENTIAL

Luce, Forward, Hamilton & Scripps LLP
600 West Broadway
Suite 2600
San Diego, CA 92101-3391
(619) 236-1414

The information contained in this electronic mail transmission is
confidential and intended to be sent only to the stated recipient of the
transmission.  It may therefore be protected from unauthorized use or
dissemination by the attorney-client and/or attorney work-product
privileges.  If you are not the intended recipient or the intended
recipient's agent, you are hereby notified that any review, use,
dissemination, distribution or copying of this communication is strictly
prohibited.  You are also asked to notify us immediately by telephone and to
return the original document to us immediately by mail at the address above.
Thank you in advance for your cooperation.