From a credit perspective, should we be in front of any other debt issue of 
CWR related to the California Procurement Adjustment, and have a dedicated 
slice of the PUC approved rates, this would, from a practical standpoint be 
at the top of credit claims.   Since repayment of the debt at the utilities 
is dependant on net cash flows (from rate payers), we functionally prime them 
as well.





	Jeff Dasovich
	Sent by: Jeff Dasovich
	02/09/2001 10:24 AM
		 
		 To: skean@enron.com, Richard Shapiro/NA/Enron@Enron, James D 
Steffes/NA/Enron@Enron, Vicki Sharp/HOU/EES@EES, Mike D Smith/HOU/EES@EES, 
Michael Tribolet/Corp/Enron@Enron, Sandra McCubbin/NA/Enron@Enron, Paul 
Kaufman/PDX/ECT@ECT, Susan J Mara/NA/Enron@ENRON, Joe 
Hartsoe/Corp/Enron@ENRON, Sarah Novosel/Corp/Enron@ENRON, mpalmer@enron.com, 
Karen Denne/Corp/Enron@ENRON
		 cc: 
		 Subject: CDWR Credit Proposal


	


FYI.  Calger is in active talks with Freeman and DWR lawyers about the offer 
letter we submitted on Tuesday.  Freeman's very anxious to do a deal for 200 
MWs from the West Desk and then start talking about a deal for power from 
Parquet's Pastoria plant.  Credit is of course the issue and Calger's told 
them that unless the credit issue is bulletproof it's not going to work.  See 
Chris' comments below.  It looks like progress is being made, but the details 
will make it or break it.  Any thoughts?  Might make sense to discuss on the 
call.  Please forward along to others.  Thanks.

Best,
Jeff
----- Forwarded by Jeff Dasovich/NA/Enron on 02/09/2001 10:22 AM -----

	Christopher F Calger@ECT
	02/08/2001 06:11 PM
		 
		 To: Tracy Ngo/PDX/ECT@ECT, Christian Yoder/HOU/ECT@ECT, Jeff 
Dasovich/NA/Enron@Enron, Chris H Foster/HOU/ECT@ECT, Tim Belden/HOU/ECT@ECT
		 cc: 
		 Subject: CDWR Credit Proposal

CDWR is proposing to all potential suppliers the following security package 
for new PPA's:

1) Irrevocable PUC Order / Agreement that "locks in the revenue stream" for 
CDWR to cover the PPA costs.

2) PPA covenant that the power supplier has payment priority over any debt, 
including the contemplated debt issue
  - the concept is that the supply is the operating cost and any debt would 
be subordinate

3) PPA Covenant that their is a uniform package to all suppliers; no more 
favorable terms or priority to ayone, no L/C, etc.


Subject to definitive language, CDWR is trying to get people to buy into this 
general plan.  What do people think?  Please try to shoot holes in this.  
Please forward to the appropriate legal, regulatory and credit folks to air 
this out.

Thanks,

Chris