Here is a note from Mike Florio of the ISO Board.  This is encouraging, he
wants to talk further about how the ISO programs can be changed to
accomplish what we want.  What would be most helpful is an item by item
analysis by EES (read: Harry and his people) as to why the existing or
proposed ISO programs are inadequate (or why we need to have 31X amended to
have the ISO do programs for direct access customers parallel to the utility
programs in 31X.)  I need this information soon in order to keep the
dialogue going with Florio.  Thanks for your help.  Mike Day

-----Original Message-----
From: Mike Florio [mailto:mflorio@turn.org]
Sent: Wednesday, March 21, 2001 7:51 PM
To: MDay
Subject: Re: Demand Bidding Legislation (what used to be AB31X- Wright)


Just to show how up to speed I am, I thought that the ISO was already
planning to do this.  Their presentation on demand programs at the last
board meeting showed a scheduling coordinator option and a UDC option, with
different billing and settlement provisions for each.  But it's hard for me
to judge what is adequate (and user-friendly) and what is not absent some
expert help.  I'm definitely interested in the concept and have no great
faith in utility management of programs of this nature.  Let's pursue.
MIKE

P.S.  In his own inimitable way, Dan Richard "offered" me the ORA job way
back when.  I said: "Gee, Dan, I thought we were friends!"   When he acted
all surprised and hurt in that way of his, I reminded him that Marty Lyons
and Mark Loy come with the turf.  End of discussion.


At 05:05 PM 3/21/2001 -0800, you wrote:
>Mike:
>
>I wanted your reaction to a proposal we were making in response to the
>Wright 31X bill on demand bidding programs.  We strongly support these
>programs, and feel that ESPs can bring a lot of benefit to the program by
>aggregaring customers, educating them on the benefits of bidding
"Negawatts"
>and helping to meter and verify their load reductions.  We are certain that
>we could help enroll more customers in the program than if the utilities
>alone were in charge.  So, we proposed language for 31X which allowed ESPs
>to aggregate customers in the utility day ahead and hour ahead programs,
and
>proposed an additional day ahead program based on economic value, (not
>reliability criteria, like reserve margins).
>
>The utilities and the large customers wanted to clarify that we would not
>include direct access customers in the utility programs, because of the odd
>funding source (reductions from the amounts paid to DWR).  We agreed with
>the concept, we don't want to fund demand reduction programs for Direct
>Access customers through DWR payments, but we also feel strongly that there
>should be similar non-discriminatory demand reduction programs for all
types
>of customers, including DA.  So we came up with the idea of inserting
>language in the bill to require the ISO to institute demand bidding
programs
>which match the ones mandated in the bill for the IOUs.  I gave our
>suggestion to Robin Larson, and I don't imagine you've seen it yet, but
>would you give me your reaction to the basic concept?   I looked at the ISO
>website and tried to evaluate the demand bidding programs already in
>place--with a limited amount of understanding, but Enron's business folks
>indicated that they did not consider the existing programs to be the
>equivalent of what the utilities will be implementing.  If that is so, how
>about putting similar programs in place so we can actively market and
>encourage all customers to bid their negawatts (especially the economic,
bid
>and contract in advance deals) so that the ISO can count on the demand
>reductions in advance of a day's operations?
>
>I await your response.
>
>I am so sorry you are not the next ORA director, I was certain you would be
>appointed to that, too. (gallows humor)
>
>Mike Day