Message-ID: <32194525.1075843201934.JavaMail.evans@thyme> Date: Tue, 24 Oct 2000 09:57:00 -0700 (PDT) From: jeff.dasovich@enron.com To: lysa.akin@enron.com Subject: Re: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Jeff Dasovich X-To: Lysa Akin X-cc: X-bcc: X-Folder: \Jeff_Dasovich_Dec2000\Notes Folders\Sent X-Origin: DASOVICH-J X-FileName: jdasovic.nsf I could do it in the morning. Say, before 11 am. that work? Lysa Akin@ECT 10/24/2000 04:36 PM To: Jeff Dasovich/NA/Enron cc: Subject: Re: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources How ugly is ugly? ---------------------- Forwarded by Lysa Akin/PDX/ECT on 10/24/2000 02:42 PM --------------------------- Enron Capital & Trade Resources Corp. From: Marcia A Linton @ ENRON 10/24/2000 02:12 PM To: Lysa Akin/PDX/ECT@ECT cc: Subject: Re: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Lysa, Anytime Wednesday is good for Jim for the conference call. Thanks, Marcia ---------------------- Forwarded by Lysa Akin/PDX/ECT on 10/24/2000 02:42 PM --------------------------- ALLISON NAVIN@ENRON 10/24/2000 02:14 PM To: Lysa Akin/PDX/ECT@ECT cc: Tom Briggs/NA/Enron@Enron, Amy Fabian/Corp/Enron@ENRON, Bernadette Hawkins/Corp/Enron@ENRON Subject: Re: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Cynthia is available Wednesday after 2 p.m. EDT; Thursday after 1 p.m. EDT; and Friday in the morning until 12:00 p.m. and after 2 p.m. EDT. Thanks. Lysa Akin@ECT 10/24/2000 04:32 PM To: Joe Hartsoe/Corp/Enron@ENRON, Jeff Dasovich/NA/Enron@Enron, Susan J Mara/SFO/EES@EES, Tom Briggs/NA/Enron@Enron, Cynthia Sandherr/Corp/Enron@ENRON, James D Steffes/NA/Enron cc: Bernadette Hawkins/Corp/Enron@ENRON, Joseph Alamo/NA/Enron@Enron, Allison Navin/Corp/Enron@ENRON, Marcia A Linton/NA/Enron, Mary Hain/HOU/ECT@ECT Subject: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Mary Hain has asked me to set a conference call to discuss the topic referenced below. Please advise ASAP your availability for a call on Wednesday (25th), Thursday (26th) or Friday (27th). ---------------------- Forwarded by Lysa Akin/PDX/ECT on 10/24/2000 01:33 PM --------------------------- From: James D Steffes@ENRON on 10/24/2000 01:05 PM CDT To: Joe Hartsoe/Corp/Enron@ENRON, Mary Hain/HOU/ECT@ECT, Jeff Dasovich/NA/Enron@Enron, Susan J Mara/SFO/EES@EES cc: Tom Briggs/NA/Enron@Enron, Cynthia Sandherr/Corp/Enron@ENRON Subject: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Can everyone help Tom respond within Congress to this message? Tom, also be forewarned that FERC intends to announce their "proposed remedies" on Nov 1 with about 15 days for response. We need you guys to be ready for messaging this politically. Jim ----- Forwarded by James D Steffes/NA/Enron on 10/24/2000 01:03 PM ----- Tom Briggs 10/24/2000 12:32 PM To: James D Steffes/NA/Enron@Enron, Mary Hain/HOU/ECT@ECT cc: Subject: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources It seem sthat the Cal Iso has lost its mind. Cynthia and I have been trading phone calls with Bilbray's staff to schedule a meeting. In the event we can get one, can I have help rebutting this stuff. It seems that the England and Wales Pool, which effectively compelled 100% bidding in the day ahead market was still frought with gaming between the day ahead market and the within day balancing market. ----- Forwarded by Tom Briggs/NA/Enron on 10/24/2000 11:22 AM ----- Cynthia Sandherr 10/24/2000 10:32 AM To: Tom Briggs/NA/Enron@Enron cc: Subject: Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Tom: when we meet with Congressman Bilbray's staff, is this something we should bring up and have a position on....I would assume yes......but wanted to close the loop..... -- Cal-ISO Wants Pwr Generators To Forward Bid 70% -Sources Copyright , 2000 Dow Jones & Company, Inc. By JASON LEOPOLD Of DOW JONES NEWSWIRES LOS ANGELES (Dow Jones)--The California Independent System Operator is expected to file a petition with federal regulators Friday seeking authority to force generators to bid 70% of their supply into the forward market in an effort to reduce wholesale power costs in the state, according to a source familiar with the issue. An official with the state's Electricity Oversight Board confirmed the details of the filing. The filing calls for FERC to set a "just and reasonable" rate for a large fraction of suppliers' capacity, while remaining supply would be able to earn market-based rates, according to the source. In addition, major out-of-state generators would have to enter into forward contracts at FERC mandated rates for "a significant portion of their expected sales." ISO Chairman and Chief Executive Terry Winter will hold a news conference Friday morning that will focus on possible solutions to lower wholesale energy costs. He is expected to announce how bidding into the forward market will stabilize high wholesale power costs. The state's Public Utilities Commission is expected to make a similar filing with federal regulators in the near future, sources said. In addition, forcing generators to bid into the forward market is a measure that would reduce market power in the state and would protect a majority of utilities served by the generators from the cost impact of market power, the ISO has said in prior meetings. Market power is a term used by economists to describe how generators can influence power prices. According to an ISO report, market power occurred this past summer because tight power supply and concentration of generation ownership "allowed suppliers to be pivotal at relatively high demand periods." About 50% to 60% of the power purchased this past summer was done in the spot market, an unusually high percentage, according to the ISO. In order to mitigate market power, the filing calls for utilities to enter into two-year forward contracts with generators to shield against the daily market price fluctuations. Regulatory constraints associated with forward contracting was a "key source of high (power) costs in the summer of 2000," according to an ISO report. The ISO action will be taken without approval from a the grid operator's board of governors. Usually, a majority of the board is required to approve such an action. EOB Official Surprised By ISO Action The announcement of the ISO's expected filing came as a surprise to Gary Heath, executive director of the state's Electricity Oversight Board. Heath told Dow Jones Newswires he was aware of the filing and news conference. "We're trying to find out what's behind this," Heath told Dow Jones Newswires. "We're not sure if they could do this without board approval. It came as a surprise." Sources said the agency is holding the news conference in an attempt to eclipse imminent structural changes to the ISO expected to be proposed by the Federal Energy Regulatory Commission next month. FERC launched an investigation into California's troubled power market this past summer based on allegations that the market isn't workably competitive and participants manipulate the market. Energy officials have blamed the ISO for this summer's power woes. -By Jason Leopold; Dow Jones Newswires; 323-658-3874; mailto:jason.leopold@dowjones.com (END) Dow Jones Newswires 20-10-00 0307GMT Michael E. Nix Michael E. Nix Consulting menix@gateway.net 1545 18th St. NW #711 Washington, DC 20036 202.234.1086 202.422.3565-cell