IMPORTANT NOTICE
UNDERSCHEDULING PENALTY AND
PG&E BANKRUPTCY PROOF OF CLAIMS
As you are aware, the claims bar date in the PG&E bankruptcy is September
5th.  Consistent with our practice of providing information held by the ISO
to Market Participants that concerns the amounts that may be owed to them in
part by PG&E, the ISO is today sending to each Scheduling Coordinator an
accounting of the amounts it owes or is owed in the event the
underscheduling penalty is not modified by FERC.  FERC adopted the
underscheduling penalty in a December 15, 2000 Order.  Because there are
several rehearing petitions pending regarding the underscheduling penalty,
to date the ISO has calculated but has not invoiced amounts owed or owing
pursuant to the underscheduling penalty.  It is our expectation that
Scheduling Coordinators will share with individual entities for whom they
schedule, information that is relevant to them.
As we have advised in prior Market Notices, although the ISO settles
transactions on behalf of Market Participants, the ISO is neither authorized
nor in a position unilaterally to assert claims on behalf of Market
Participants in any bankruptcy proceeding, i.e. assert claims of "ISO
Debtors" against "ISO Creditors" (ISO Tariff Section 11.20.1).  Further,
while the ISO may be asked by an "ISO Debtor" to assert such claims in the
PX or PG&E bankruptcy cases, the ISO is not obliged to do so and will
decline any such request.  The ISO expressly disavows any liability for any
Market Participant's claims, whether or not the Market Participant files any
such proofs of claim in the PX or PG&E bankruptcy proceedings.
Further, as we have advised in prior Market Notices, all statements,
including the information sent today regarding the underscheduling penalty,
are subject to change.  A number of transactions are currently known to be
the subject of disputes and market reruns.  There are also proceedings
pending at FERC, Federal Courts, and State Courts, the outcomes of which may
affect amounts owed by PG&E to each Market Participant or by the Market
Participant to PG&E. In addition, we anticipate that further disputes and
proceedings may arise and market reruns may be performed that will affect
the calculation of such amounts.  The ISO will continue to work diligently
to resolve these matters as quickly as possible.  Nonetheless, it is clear
that significant issues may remain unresolved and/or unidentified by the
claims bar date.
Market Participants should consult their own legal COUNSEL as to their
respective rights  and proofs of claims in the bankruptcy cases of the PX
and PG&E.
Client Relations Communications
CRCommunications@caiso.com <mailto:CRCommunications@caiso.com>