Message-ID: <7499392.1075851657037.JavaMail.evans@thyme> Date: Fri, 12 Oct 2001 15:54:22 -0700 (PDT) From: douglas.porter@sce.com To: jeff.dasovich@enron.com Subject: Re: Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Douglas.Porter@sce.com X-To: Dasovich, Jeff X-cc: X-bcc: X-Folder: \Dasovich, Jeff (Non-Privileged)\Dasovich, Jeff\Inbox X-Origin: DASOVICH-J X-FileName: Dasovich, Jeff (Non-Privileged).pst We went into the FERC proceeding believing that the Chief ALJ was not likely to give us a good decision. During the course of the proceeding, we convinced ourselves that he would rule our way due to the vast evidence in our favor and the relatively inept presentation of El Paso and El Paso Merchant Energy. Well, despite the voluminous record in support of our position, the judge ruled that it was "not at all clear" that El Paso exercised market power. The good news for your affiliates is that, if the Commission does not find the exercise of market power in this case, it never will. We hope when the Commission reviews the entire record, including the "protected material", they will change the ALJ's finding. On some level we believe that the ALJ just does not like California. He is the judge, after all, who told Harold Ray in the electric generation settlement discussions that he was "an asshole". The ironic part of the decision is that we felt that a determination by the ALJ that defined the market in such a way as to preclude EPME having market power would be difficult to overcome at the Commission level. Instead, he defined the market as we suggested and found that El Paso had market power; he simply failed to be convinced that they were withholding capacity despite the fact that they utilized their capacity 54% of the time when everyone else was utilizing their own capacity at a capacity factor of between 85% and 90%. Go figure. I am still less than enchanted with the NGS settlement after SoCalGas tailored it to their interests but am glad that the Commission is at least considering opening up the system ala PG&E. I think that they are reasonably aware that SoCalGas was not blameless in the runup in gas prices that took place last December. Having said that we are having a hell of a time in the GCIM simply trying to investigate what really happened. SoCalGas latest excuse for not giving us info is that we will "competitors" with them (as a result of the filed rate litigation) for gas hedges. I must have misunderstood; I did not realize there was a limited supply of hedges available and that there was competition for those "available" hedges. Anytime Enron wants to help on these GCIM issues, we would welcome it--might make you look less like a Texas robber baron. Douglas Porter, Senior Attorney Southern California Edison Company (626)302-3964 (626)302-3990(fax) douglas.porter@sce.com "Dasovich, Jeff" To: Subject: 10/12/01 03:18 PM Hi Doug: Hope all is well. Congratulations to you folks on your agreement with the PUC. Must be a relief. I was writing to get your reaction to the judge's proposed order in the El Paso case. You think the Commission is likely to adopt it? Change it? Judge's proposal fatally flawed on the market power issue? Appreciate your insights. AND did you hear Bilas issued the our gas settlement as his proposed decision for adoption by the Commission at its 10.25.01 meeting!?!?! What next? Best, Jeff ********************************************************************** This e-mail is the property of Enron Corp. and/or its relevant affiliate and may contain confidential and privileged material for the sole use of the intended recipient (s). Any review, use, distribution or disclosure by others is strictly prohibited. If you are not the intended recipient (or authorized to receive for the recipient), please contact the sender or reply to Enron Corp. at enron.messaging.administration@enron.com and delete all copies of the message. This e-mail (and any attachments hereto) are not intended to be an offer (or an acceptance) and do not create or evidence a binding and enforceable contract between Enron Corp. (or any of its affiliates) and the intended recipient or any other party, and may not be relied on by anyone as the basis of a contract by estoppel or otherwise. Thank you. **********************************************************************