As you know, Enron does not own transmission facilities and therefore is not 
subject to the FERC code of conduct rules with respect to functional 
separation of generation and transmission.

However, when Enron established 3 control areas in the SERC region in 
June-July 1999, a separate legal entity (Enron SE Corp) was created to 
provide the reliability/control area operation function for Enron's Southeast 
generation assets.  Although functional separation is not required by FERC, 
Enron chose to do so because marketing/trading is indeed separate from the 
control area reliability function at Enron.  Additionally, Enron SE Corp. (as 
a certified control area) is entitled to ISN and IDC data that is subject to 
NERC confidentiality provisions and cannot be disclosed and/or utilized by 
the merchant function.

In order to protect the IDC and ISN information consistent with the NERC 
Confidentiality Agreement (for ISN data) and the OATI/NERC Non-Disclosure 
Agreement (for IDC data), only employees within the control area reliability 
function have access to the data.   To highlight the importance of this 
confidential information, verbal and written correspondence has been provided 
by Enron's legal and regulatory counsel to each control area employee with 
specific instructions to keep all required information confidential as set 
forth in the NERC Confidentiality Agreement.

I hope this adequately answers your question.  If you have any additional 
questions, please feel free to call me at 713-853-5035.

Thanks,
Kevin Presto

---------------------- Forwarded by Kevin M Presto/HOU/ECT on 02/08/2000 
12:38 PM ---------------------------


TomK@ecar.org on 02/08/2000 12:14:49 PM
To: kpresto@enron.com, lwill@enron.com
cc: dtaylor@powersrc.com, Michael_H._Knapp@aep.com, tgeswein@cinergy.com, 
dhils@cinergy.com, rarness@ipalco.com, brad.young@lgeenergy.com, 
richard.doying@gen.pge.com 
Subject: FW: Enron Control Area Request


Hi Kevin and Lloyd,
Please respond to Dave Taylor's question listed below.  Please copy me on
your response so I can forward it to the rest of the CARTF.  Call me on
330-580-8004 if you have any questions.
Thanks

Hi Everybody Else,
For Your Information.
Tom Kraynak

-----Original Message-----
From: Taylor, David W. [mailto:David.Taylor@powersrc.com]
Sent: Tuesday, February 08, 2000 9:19 AM
To: 'TomK@ecar.org'
Cc: Wagoner, Greg
Subject: Enron Control Area Request



Tom,

 Please e-mail to me a copy of the presentation you gave to the ECAR
Executive Board last Thursday regarding Enron's request for a new control
area. I attended the meeting but the presentation was not part of the agenda
package.
 During your presentation you mentioned that Enron has agreed to
separate their marketing function from their control area function. Can you
please provide a brief explanation on what this means and how Enron plans to
accomplish this?

Dave Taylor

----------------------------------------
David W. Taylor
Constellation Power Source
111 Market Place, Suite 500
Baltimore, MD 21202
Phone: (410) 468-3478
Pager: (888)645-1697
Fax: (410) 468-3541
---------------------------------------