will be at both meetings and will have detailed proposals beforehand.  we 
continue to work on procurement piece and have reached teh same conclusion as 
you in your note---need something to implement now, as well as a "longer" 
term solution to IOU procurement.  you'll be hearing from me.



	Evelyn Kahl Elsesser <eke@aelaw.com>
	12/06/2000 03:44 PM
		 
		 To: Keith McCrea <kmccrea@sablaw.com>, "Jeff Dasovich (E-mail)" 
<jdasovic@enron.com>, Ralph Cavanagh <RCavanagh@nrdc.org>, Bill Booth 
<wbooth@booth-law.com>, Ann Cohn <cohnap@sce.com>, Jan Smutny-Jones 
<smutny@iepa.com>, Delaney Hunter <dhunter@smithandkempton.com>, "Aaron 
Thomas (E-mail)" <athomas@newenergy.com>, "Carolyn McIntyre (E-mail)" 
<cmcintyre@sempra.com>, "John Fielder (E-mail)" <fieldejr@sce.com>, "Tony 
Braun (E-mail)" <braun@cmua.org>, "jeflory@calpx.com" <jeflory@calpx.com>, 
Barbara Barkovich <brbarkovich@earthlink.net>, Dominic DiMare 
<dominic.dimare@calchamber.com>
		 cc: 
		 Subject: Update on CESG Schedule

We have scheduled a telephone conference of the CESG on Tuesday, December 
12th at 12:00 noon.  The call-in number will be 1.800.377.4827, confirmation 
number 7680189.  I have scheduled 15 lines for 1.5 hours.  We have also 
scheduled a meeting  of the group in Sacramento on Friday, December 15th, at 
10:00 at the Chamber of Commerce's office. 
In the interim, we should all be working toward building the strawpaper 
outlined in yesterday's agenda.  I plan to complete an outline of what we did 
manage to agree to (or identify as proposals) yesterday by the end of 
Friday.  Other responsibilities include: 
preparation by SCE, AES, Enron and the PX of proposals for a "benchmark" 
against which, if necessary, individual purchases by the utility could be 
measured for the next 1-2 years;  proposals for longer term benchmarks for 
measuring the reasonableness of the utility portfolio would be helpful, but 
we need to focus on the short-run first.  Also, throw out ideas on tolerance 
bands, including a way to expand/contract the band with changes in 
volatility, and risk/reward mechanisms for utility shareholders.
proposals by SCE, AES and the PX (and any others with ideas) regarding how we 
can address in an overall solution the risk perceived by the utility of 
customer attrition from the utility portfolio (e.g., term commitments, two 
portfolios or a bifurcated single portfolio, etc.);
a proposal from SCE and CLECA regarding how to commoditize the utility 
generating assets (assuming retention of the entitlement to the generation) 
and allocate those assets to small/large customers as the foundational supply 
component of two portfolios (overlaying longer term contracts in the small 
customer portfolio and potentially shorter and medium term contracts in the 
large customer portfolio).
proposals for mechanisms to provide customers with some ability to understand 
the overall cost of utility procurement for comparison with ESP fixed price 
contracts (e.g.,  publication of "actual" to date on a monthly basis, 
forecast of fixed price, fixed price product offering).
Obviously, any other ideas you have will be welcomed. 
We failed to make much progress on the design for any stabilized rate or TRA 
undercollections. Consider more carefully (1) whether a "residual" (SCE) or 
stand-alone (PG&E) calculation for procurement costs would best serve your 
interests and (2) what level of increase could be tolerated effective early 
2001.  Also consider structural proposals for addressing the TRA 
undercollections prior to the end of the rate freeze. 
Our goal should be to close on a structure, with as many details as possible, 
by Friday, December 15.  Please call me for any reason that will help us move 
this along.