The Buzz  Thursday, September 14, 2000

Due to server difficulties, The Buzz was sent out Thursday. 

In The Buzz this week:

EES Closes Sony Electronics Deal: EES just closed a fixed-price commodity 
deal with San Diego,s largest energy user, Sony Electronics, Inc. Sony is 
just one of many deals that closed in August through the collaborative 
efforts of the Market Development group. The objective of the group is to 
streamline processes and procedures to close more commodity deals faster. 
Market Development, Origination, Commodity Structuring, Risk Management, 
Account Implementation Planning (AIP), Legal, and Regulatory Affairs joined 
forces to create an easy-to-close scenario for the California markets. A 
daily executable price sheet and ready-to-use short form contract are 
products that were developed from this effort. EES Market Development scored 
their first hits in San Diego last month. Four additional deals that have 
recently closed include Burlington Coat Factory, WW San Diego Harbor Island*
Travel Lodge, Martin Furniture, and La Jolla Pharmaceuticals. Congratulations 
to the deal team and to Market Development. Click on link to learn who was 
involved:
http://inet.ees.enron.com/vision/comm/eespeople/

Enron Building Services Takes on 100 New Employees from Springs: As part of 
our agreement with Springs Industries, Springs has contracted with Enron 
Building Services for facilities management work that includes the operation 
of Springs, in-house power plants as well as their heating and 
air-conditioning systems. About 100 workers at Springs will be assumed by 
Enron Building Services. Springs reported that this is part of a continuing 
effort to bring a higher level of expertise to their mechanical 
infrastructure. Springs spokesman Ted Matthews stated that &Springs is 
proficient in making home fashions and sheets, but doesn,t have experience in 
running power plants.8  

Two of Our Customers in Wall Street Journal Cover Articles: Two of our EES 
customers are getting bigger. Chase Manhattan has agreed to acquire J.P. 
Morgan for approximately $36 billion. Chase, with over $360 billion in 
assets, is one of the world,s leading financial institutions. The Wall Street 
Journal also reported that Quebecor World was negotiating an acquisition of 
the cable company Videotron. Quebecor World is a diversified global 
commercial printing company offering customers state-of the art- printing 
capabilities, plus related value added printing services.

Skilling Makes Plea for FERC to Control Monopoly Transmission System Abuses: 
Enron President and COO Jeffrey Skilling told a National Press Club 
conference in Washington, D.C., that &the U.S. wholesale market for 
electricity is the most screwed up8 of all the deregulating markets in which 
Enron participates globally. Skilling urged the Federal Energy Regulatory 
Commission (FERC) to use its influence to ensure open access to the nation,s 
transmission grid. According to Skilling, Enron,s attempts to schedule power 
transactions have often been denied because of &alleged capacity shortages,8 
yet transmission-owning utilities turn around and use the requested capacity 
for their own generation facilities to move power along the same route. 
Skilling pointed to the fact that access to the transmission grid is hindered 
by barriers controlled by monopolies, stating &We need some very strong 
action to ensure that the system is open and that people can get power from 
places where it is available to places where it is needed.8 Skilling, who 
went on to say that the solution would be for FERC to eliminate inconsistency 
in the application of market rules to participants and ensure that the 
transmission system is opened up and nondiscriminatory. Click on link to read 
article: 
http://eeshou-dowj1.ees.enron.com/pagebuilder/viewarticle.asp?folderid=1&AN=RT
R0025031699

Some Interesting Facts: Peak demand for electricity has risen 11 percent in 
the U.S. since 1995, while reserve margins for excess power capacity dropped 
14 percent since 1997. Instances of so called transmission loading reliefs*or 
system failures*have soared 300 percent since 1998. 

California Update: Two electric utilities, Southern California Edison (SCE) 
and Pacific Gas and Electric (PG&E), who serve 90 percent of Californians, 
want to renege on the deregulation deal from 1996 that prevents SCE and PG&E 
from passing high electricity costs onto their customers until 2002. Last 
week, SCE and PG&E lobbied unsuccessfully to pass legislation that would have 
allowed them to add a surcharge to consumer bills from 2002 to 2006. Instead, 
the legislature passed a relief bill last week for the states,s smallest 
utility, San Diego Gas & Electric (SDG&E). Through the law, which imposes 
rate freezes in San Diego, SDG&E consumers and state taxpayers are expected 
to repay the higher prices over time, including interest. PG&E has paid $2 
billion from May through June for higher electricity prices without passing 
those costs to its users. That amount is expected to rise to many more 
billions until the rate ends, if prices stay at high levels. Wholesale prices 
have soared to 25 cents a KWh, which calculates into five times the six cents 
a KWh charged just a year ago. 

Seeking Nominations for the EES Chairman,s Award: Recognizing an individual 
who has gone above and beyond the parameters of his or her job and has 
demonstrated exemplary performance, EES Chairman's Award nominations for the 
third quarter are due September 30. Nomination forms can be found on the 
vision site under EES people.

If you missed Mark Harada,s Brown Bag Check it out Online: Mark,s Brown Bag 
discussed electric deregulation in Illinois and how Commonwealth Edison 
services to customers fall short of those provided by EES: Click on link to 
view video of Brown Bag: 
http://eeshou-etv02.ees.enron.com/brownbags/bb_marcharada/index.html