AB 1890 Group:

A response to the ISO's recent message regarding CMUA's proposed language is
necessary.

First, CMUA proposed its language to the Group on participation of municipal
System Units during the week of August 21st, and discussed the matter at
length with the Group when ISO representatives were in attendance and
commenting on various drafting suggestions. Any implication that there is an
element of surprise associated with the CMUA language is unfounded.  If
anything, it is the ISO's latest suggestion to remove the language that is
tardy.  The Letter underwent several iterative changes, during which time
the ISO had an opportunity to make constructive suggestions to modify the
language (preferably), or at a minimum explain its position so that the
Group could consider the issue.

Second, the ISO indicates that "there is ongoing and longstanding litigation
over how to bring MUNIs into the ISO system," as a reason for not including
the language in the proposed Letter.  Certainly, the fact that an issue is
being litigated is not a distinguishing characteristic.  What issue hasn't
been litigated, including Load participation in ISO Ancillary Service
markets?! As we fully discussed with the Group, there are a host of issues
associated with municipal/ISO discussions, including ISO cost allocation to
Load.  CMUA's specific proposal is to uncouple issues of transmission and
Load cost allocation from the issue of getting generation capacity into the
markets.  It is unfortunate that, when we all recognize that we need more
capacity in the ISO markets to deepen supply, the ISO is taking a position
to hold on to "chits" in an effort to strengthen its hand on transmission
and Load cost allocation issues.  The end result is that generation is not
in the ISO markets (whatever the exact number, it is far in excess of
several of the other recommendations made in the letter) because the issue
is being held hostage for negotiating purposes on issues that have nothing
to do with supply.

At this point, it appears we will not have agreement on this matter.  In the
past, the Group has acted as a consensus organization.  CMUA would like the
group to consider how the letter is characterized to the Governor, or anyone
else, if one or more members have remaining concerns.

Tony Braun
Braun & Associates, P.C.
915 L Street
Suite 1460
Sacramento, California 95814
(916) 441-1733
(916) 441-4053 (facsimile)
braun@braunlegal.com

Counsel to CMUA







-----Original Message-----
From: Larson, Robin [mailto:RLarson@caiso.com]
Sent: Monday, September 18, 2000 10:42 AM
To: 'Karen Edson'; dhunter@smithandkempton.com; 'Aaron Thomas (E-mail)';
'Allan Lippincott'; 'Ann Cohn (E-mail)'; 'Ann Watson'; 'Anna Ferrera
(E-mail)'; 'Art Carter'; 'assistant for John Fielder'; Barkovich,
Barbara; Kilbourne, Becky; 'Bill Booth (E-mail)'; 'Bill Dombrowski';
'Bill Keese (E-mail)'; 'Bill Zobel (E-mail)'; 'Bob Foster'; 'Bob
Houston'; 'Carolyn McIntyre (E-mail)'; 'Carolyn Veal-Hunter (E-mail)';
'Catherine Hackney (E-mail)'; 'Charles Bacchi (E-mail)'; 'Craig Brown';
'Dan Carroll (E-mail)'; Cazalet, Denise; 'Dennis Price (E-mail)'; 'Denny
Samuel'; 'Dominic DiMare'; 'Dorothy Rothrock (E-mail)'; 'Ed Yates';
'Eloy Garcia (E-mail)'; Elsesser, Evelyn; Heath, Gary; 'Gordon
McDonald'; 'Jack Flanigan'; 'Jack Gualco (E-mail)'; 'Jack Stewart';
'James Boyd'; 'Jan Smutny-Jones (E-mail)'; 'Jeff Dasovich (E-mail)';
Jordan, Jerry; 'Jim Cassie (E-mail)'; 'Jim Groniger (E-mail)'; 'Joe
Lyons (E-mail)'; Ronan, Joe; 'John Bridges (E-mail)'; 'John Fielder';
'John Fistolera (E-mail)'; 'John Larrea (E-mail)'; 'John Rozsa
(E-mail)'; 'John White (E-mail)'; 'Joseph Alamo'; 'Julia Wright'; 'Karen
Jarrell (E-mail)'; Koyano, Karen; Lindh, Karen; 'Karen Mills (E-mail)';
'Kari Harteloo'; 'Kathy Brandenburg'; 'Kay Grosulak (E-mail)'; 'Keith
McCrea (E-mail)'; 'Kevin Lynch (E-mail)'; Smith, Kevin; 'Lawrence
Lingbloom (E-mail)'; 'Lenny Goldberg (E-mail)'; 'Louis Szablya
(E-mail)'; 'Marc Joseph (E-mail)'; 'Marwan Masri (E-mail)'; 'Mary
McDonald (E-mail)'; Alcantar, Michael; Florio, Mike; 'Mike Kahl'; 'Mona
Petrochko (E-mail)'; 'Pete Conaty (E-mail)'; 'Phil Nails'; 'Phil Stohr
(E-mail)'; 'Ralph Cavanagh (E-mail)'; 'Randy Chinn (E-mail)'; 'Ray
Thompson (E-mail)'; 'Rick Counihan'; Berry, Robert; Larson, Robin;
'Sheryl Carter (E-mail)'; 'Steve Pike (E-mail)'; 'Stu Wilson (E-mail)';
Mara, Sue; 'Susan Reeder (E-mail)'; Winter, Terry; Dinkel, Tom; 'Tim
Schmelzer (E-mail)'; 'Tommy Ross'; 'Tony Braun'; 'Victoria Schaefer
(E-mail)'
Cc: Winter, Terry
Subject: RE: IMPORTANT -- Letter to Governor Davis


I do not have a comment on Karen's edit, but I wanted to email the entire
group about CMUA's insistence on keeping Proposal 8 under the generation
section. (This is the section referencing potential MUNI units that could be
bid into the ISO A/S market if we can figure out a way to avoid having them
join formally). I had mentioned when this was first brought up--which was
frankly rather late in the drafting game--that I thought this would be very
controversial at ISO. Not only does ISO not concur with the notion that
there would be "over 1000 MW of addiitonal supply into A/S markets" but
placing this language in a letter to the Governor makes it look like ISO is
the obstacle to having these units available.  There is ongoing and
longstanding litigation over how to bring MUNIs into the ISO system.  I am
not uncomfortable with discussing this issue at any AB 1890 meeting, but
forcing the issue in this Governor's letter is not placing the issue on a
level playing field in my opinion.

If CMUA decides not to sign the letter without this controversial piece that
will be unfortunate.

-----Original Message-----
From: Karen Edson [mailto:kedson@ns.net]
Sent: Thursday, September 14, 2000 1:19 PM
To: dhunter@smithandkempton.com; 'Aaron Thomas (E-mail)'; 'Allan
Lippincott'; 'Ann Cohn (E-mail)'; 'Ann Watson'; 'Anna Ferrera (E-mail)';
'Art Carter'; 'assistant for John Fielder'; 'Barbara Barkovich
(E-mail)'; 'Becky Kilbourne'; 'Bill Booth (E-mail)'; 'Bill Dombrowski';
'Bill Keese (E-mail)'; 'Bill Zobel (E-mail)'; 'Bob Foster'; 'Bob
Houston'; 'Carolyn McIntyre (E-mail)'; 'Carolyn Veal-Hunter (E-mail)';
'Catherine Hackney (E-mail)'; 'Charles Bacchi (E-mail)'; 'Craig Brown';
'Dan Carroll (E-mail)'; 'Denice Cazalet'; 'Dennis Price (E-mail)';
'Denny Samuel'; 'Dominic DiMare'; 'Dorothy Rothrock (E-mail)'; 'Ed
Yates'; 'Eloy Garcia (E-mail)'; 'Evelyn Elsesser (E-mail)'; 'Gary Heath
(E-mail)'; 'Gordon McDonald'; 'Jack Flanigan'; 'Jack Gualco (E-mail)';
'Jack Stewart'; 'James Boyd'; 'Jan Smutny-Jones (E-mail)'; 'Jeff
Dasovich (E-mail)'; 'Jerry Jordan'; 'Jim Cassie (E-mail)'; 'Jim Groniger
(E-mail)'; 'Joe Lyons (E-mail)'; 'Joe Ronan'; 'John Bridges (E-mail)';
'John Fielder'; 'John Fistolera (E-mail)'; 'John Larrea (E-mail)'; 'John
Rozsa (E-mail)'; 'John White (E-mail)'; 'Joseph Alamo'; 'Julia Wright';
'Karen Jarrell (E-mail)'; 'Karen Koyano (E-mail)'; 'Karen Lindh'; 'Karen
Mills (E-mail)'; 'Kari Harteloo'; 'Kathy Brandenburg'; 'Kay Grosulak
(E-mail)'; 'Keith McCrea (E-mail)'; 'Kevin Lynch (E-mail)'; 'Kevin Smith
(E-mail)'; 'Lawrence Lingbloom (E-mail)'; 'Lenny Goldberg (E-mail)';
'Louis Szablya (E-mail)'; 'Marc Joseph (E-mail)'; 'Marwan Masri
(E-mail)'; 'Mary McDonald (E-mail)'; 'Michael Alcantar (E-mail)'; 'Mike
Florio (E-mail)'; 'Mike Kahl'; 'Mona Petrochko (E-mail)'; 'Pete Conaty
(E-mail)'; 'Phil Nails'; 'Phil Stohr (E-mail)'; 'Ralph Cavanagh
(E-mail)'; 'Randy Chinn (E-mail)'; 'Ray Thompson (E-mail)'; 'Rick
Counihan'; 'Robert Berry (E-mail)'; 'Robin Larson (E-mail)'; 'Sheryl
Carter (E-mail)'; 'Steve Pike (E-mail)'; 'Stu Wilson (E-mail)'; 'Sue
Mara'; 'Susan Reeder (E-mail)'; 'Terry Winter (E-mail)'; 'Thomas Dinkel
(E-mail)'; 'Tim Schmelzer (E-mail)'; 'Tommy Ross'; 'Tony Braun';
'Victoria Schaefer (E-mail)'
Subject: RE: IMPORTANT -- Letter to Governor Davis



Delaney -

IEP has one minor edit to the draft letter and three edits to the
recommendations.  Three of our four suggestions are driven by legislation
sent to the Governor in the last days of session.  A redlined version is
attached.  I hope this is helpful.

(1) We propose to eliminate one proposed solution that is part of AB
970.
Our edits move to the description of AB 970 the recommendation for allowing
plants expected to come on line in 2 or 3 years to come on line earlier as
single cycle facilities from the list of solutions.

(2) We propose to move the proposal to expedite renewable generation to
a
comment that signing AB 995/SB 1194 will expedite more than 500 MW of new
renewable generation by next summer.  (This number is based on a CEC
letter.)

(3) We propose to consolidate solutions 4 and 5 since both involve
changes
or additions to existing plants.

(4) Finally, we propose to modify the description of the CEC's expedited
siting process to reflect AB 970 more accurately.

If you have any questions, please call.

Karen Edson
kedson@ns.net




-----Original Message-----
From: Delaney Hunter [mailto:dhunter@smithandkempton.com]
Sent: Tuesday, September 12, 2000 5:03 PM
To: Aaron Thomas (E-mail); 'Allan Lippincott'; Ann Cohn (E-mail); 'Ann
Watson'; Anna Ferrera (E-mail); 'Art Carter'; 'assistant for John
Fielder'; Barbara Barkovich (E-mail); 'Becky Kilbourne'; Bill Booth
(E-mail); 'Bill Dombrowski'; Bill Keese (E-mail); Bill Zobel (E-mail);
'Bob Foster'; 'Bob Houston'; Carolyn McIntyre (E-mail); Carolyn
Veal-Hunter (E-mail); Catherine Hackney (E-mail); Charles Bacchi
(E-mail); 'Craig Brown'; Dan Carroll (E-mail); 'Denice Cazalet'; Dennis
Price (E-mail); 'Denny Samuel'; 'Dominic DiMare'; Dorothy Rothrock
(E-mail); 'Ed Yates'; Eloy Garcia (E-mail); Evelyn Elsesser (E-mail);
Gary Heath (E-mail); 'Gordon McDonald'; 'Jack Flanigan'; Jack Gualco
(E-mail); 'Jack Stewart'; 'James Boyd'; Jan Smutny-Jones (E-mail); Jeff
Dasovich (E-mail); 'Jerry Jordan'; Jim Cassie (E-mail); Jim Groniger
(E-mail); Joe Lyons (E-mail); 'Joe Ronan'; John Bridges (E-mail); 'John
Fielder'; John Fistolera (E-mail); John Larrea (E-mail); John Rozsa
(E-mail); John White (E-mail); 'Joseph Alamo'; 'Julia Wright'; Karen
Edson (E-mail); Karen Jarrell (E-mail); Karen Koyano (E-mail); 'Karen
Lindh'; Karen Mills (E-mail); 'Kari Harteloo'; 'Kathy Brandenburg'; Kay
Grosulak (E-mail); Keith McCrea (E-mail); Kevin Lynch (E-mail); Kevin
Smith (E-mail); Lawrence Lingbloom (E-mail); Lenny Goldberg (E-mail);
Louis Szablya (E-mail); Marc Joseph (E-mail); Marwan Masri (E-mail);
Mary McDonald (E-mail); Michael Alcantar (E-mail); Mike Florio (E-mail);
'Mike Kahl'; Mona Petrochko (E-mail); Pete Conaty (E-mail); 'Phil
Nails'; Phil Stohr (E-mail); Ralph Cavanagh (E-mail); Randy Chinn
(E-mail); Ray Thompson (E-mail); 'Rick Counihan'; Robert Berry (E-mail);
Robin Larson (E-mail); Sheryl Carter (E-mail); Steve Pike (E-mail); Stu
Wilson (E-mail); 'Sue Mara'; Susan Reeder (E-mail); Terry Winter
(E-mail); Thomas Dinkel (E-mail); Tim Schmelzer (E-mail); 'Tommy Ross';
'Tony Braun'; Victoria Schaefer (E-mail)
Subject: IMPORTANT -- Letter to Governor Davis


Folks-
At today's meeting, those Group members who attended agreed that we should
indeed send the letter with changes reflecting the new legislation. Attached
is the newest draft of such a letter. We need to send this letter out FRIDAY
so in order to do that please look over the letter carefully and let me know
if your organization wishes to be included as a signatory. I need every set
of eyes out there to look this letter over for spelling, grammar and
content -- my eyes have seen it too many times and are apt to miss things.
So, here is the process ---

Let me know of any minor changes ASAP. If there are content changes please
email them to the ENTIRE group for sign off. Please understand that we want
to send this FRIDAY so we do not have a lot of time to make changes. When I
have a final draft I will ask people to fax signatures or send originals to
me by Friday.Thank you all for your help with this letter. We could not have
done it with out you.

We will be scheduling our next general meeting for mid October. Also, we
have finalized the dates for the Annual Retreat and will be sending out
packets with all the details next week. DJ and I are working on the agenda
so if you have a specific topic you would like covered please let us know.
As always, please send me an email or give me a call if you have any
concerns or questions about the letter or any other matter.

Thanks,
Delaney