Attached is FERC's press release on Southern RTO. 

The FERC did the right thing in not approving this RTO, but clearly they missed a golden opportunity to mandate GridSouth and Southern RTO joining together.  Another signal that more pressure is required to get FERC to open up these transmission markets.

Jim

----- Forwarded by James D Steffes/NA/Enron on 03/17/2001 11:28 AM -----


	Christi L Nicolay@ECT 03/15/2001 11:11 AM 	   To: ozzie.pagan@enron.com, heather.kroll@enron.com, david.fairley@enron.com, george.mccormick@enron.com, wjennin@enron.com, joseph.wagner@enron.com, elizabeth.johnston@enron.com, bill.rust@enron.com, Reagan Rorschach/NA/Enron, Edith Cross/HOU/ECT@ECT, Berney C Aucoin/HOU/ECT@ECT, Jennifer Bagwell/NA/Enron, Billy Braddock/NA/Enron, Joe Connor/NA/Enron@Enron, Tom Chapman/HOU/ECT@ECT, James D Steffes/NA/Enron@Enron, Ron McNamara/NA/Enron@Enron, Mike Roan/ENRON@enronXgate, Thane Twiggs/ENRON_DEVELOPMENT@ENRON_DEVELOPMENT, Rogers Herndon/HOU/ECT@ect, John M Forney/NA/Enron@Enron, Mike Carson/Corp/Enron@Enron, Laura Podurgiel/HOU/ECT@ECT, Richard Shapiro/NA/Enron@Enron, Steven J Kean/NA/Enron@Enron  cc:   Subject: FERC's Press Release re: Southern RTO	



The Federal Energy Regulatory Commission rejected two key elements of
Southern Company Services, Inc.'s proposed Regional Transmission Organzation (RTO)
and encouraged the company to explore joining neighboring utilities in an RTO for the
Southeast. The Commission did not act on other issues raised by Southern.

Southern's proposal for a for-profit gridco (grid company) that would include only
new wholesale transmission services and have the benefits of certain rate incentives
going to others rather than the RTO operator are inconsistent with FERC's RTO policy,
the Commission said. Under Southern's proposal, existing owners' transmission facilities
related to bundled retail service or native load would not be under the gridco's control.
As a result, the vast majority of total transmission load would not be under the RTO's
tariff, operation or direction.

The RTO rule requires all transmission facilities operate under the transco. In
addition, Southern could not plan, design and operate a regional grid in a manner that
maximizes efficiency if the transco controlled only a small part of the RTO load, the
Commission said in rejecting Southern's proposal.

As an alternative to filing a revised RTO proposal, the Commission asked that
Southern consider joining neighboring utilities in an RTO in the Southeast. The
Commission directed Southern to file a report by July 13, 2001, on progress in forming a
Southeastern RTO.