FYI!  Please see the emails below.  I just wanted to let you know that this "political" battle within EES/EWS is brewing.  I have been providing support whenever I have been asked, e.g. answering questions, research, etc.  I will be in my office tomorrow if you would like to discuss or have any questions.  Otherwise you can page me today (I have meetings and flights, but I will call if I can.)  Thanks.

Nancy A. Hetrick
Enron Corp.
Director, Government Affairs
Phone:  712-366-3399
Pager:   888-912-1426

 -----Original Message-----
From: 	Ader, Jeff  
Sent:	Tuesday, October 16, 2001 12:21 PM
To:	Wagner, Joseph
Cc:	Delainey, David; Dietrich, Janet; Blachman, Jeremy; Holmes, Sean; Bernstein, Mark; Hetrick, Nancy; Herndon, Rogers; Ochsner, Preston
Subject:	Re: ERCOT LSE's

Joe,

I requested a meeting with you yesterday to work with you and convey what we have learned over the last three months by working with regulatory and the ERCOT ISO to utilize and create additional LSE accounts.  As you were informed by Nancy Hetrick of regulatory all three currently available LSE account are committed by Structured Supply for use under currently negotiated masters.  We requested the meeting with you yesterday to explain what we were doing and why we needed the other three EES LSE accounts.  We also took the time to explain the process for establishing new LSE accounts, under a LLC structure which is not complicated, but the structure that the new LSE accounts would be created under (SPV) is inconsistent with the masters negotiated and EES would not be able to perform under these masters.

We have tried to work with you in cooperation to accomplish your goals consistent with the constraints of the ERCOT rules.  We have explained our needs and the reason for them. We conveyed our interest in working together to accomplish the greater good for the company and offered our help in any way we could.  You mark and I agreed that it would be easier to help each other and not duplicate efforts.  We were appreciative of your willingness to proceed consistent with this spirit of cooperation.  It disheartens and surprises me that you would leave the meeting with this understanding and in agreement of the business situation and send an e-mail the next morning, without picking up the phone or stopping by to discuss this and just attempt to dictatorially commandeer the LSE accounts that you knew were committed and why they were committed.  

Moreover; you told us that you thought you might need one more and you have attempted to take three more.

Best regards,


Jeff




From:	Joseph Wagner/ENRON@enronXgate on 10/16/2001 09:14 AM
To:	Mark Bernstein/HOU/EES@EES, Jeff Ader/HOU/EES@EES
cc:	Nancy Hetrick/ENRON@enronXgate, Rogers Herndon/ENRON@enronXgate, Preston Ochsner/ENRON@enronXgate 
Subject:	ERCOT LSE's

Thank you for taking the time to discuss the LSE situation in ERCOT.  The present LSE was set up by EES and is being utilized by EWS Retail and EWS Services Group, for physical delivery in ERCOT for EES load.  In order to better manage EES volume and structure growth in ERCOT, billing issues, and optimization of the present and future portfolio, EES/EWS Retail will require the use of the sub LSE's available under EES's existing LSE arrangement.  Structured Supply will be responsible for the creation of any LLC's that need to be created to facilitate additional LSE availability.  If you have any questions or comments, please either email or call me (ext 33143).  Thanks.

-Joe