Message-ID: <19634832.1075854837851.JavaMail.evans@thyme> Date: Thu, 6 Sep 2001 05:46:13 -0700 (PDT) From: m..presto@enron.com To: sarah.novosel@enron.com Subject: RE: Support of PJM's Proposal to Implement Northeast RTO Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: quoted-printable X-From: Presto, Kevin M. X-To: Novosel, Sarah X-cc: X-bcc: X-Folder: \Presto, Kevin M (Non-Privileged)\Presto, Kevin M.\Sent Items X-Origin: Presto-K X-FileName: Presto, Kevin M (Non-Privileged).pst I read the proposal last night, and although it is not perfect, it is a big= improvement over what we have today. Therefore, I (and my team) support = Enron's endorsement of the PJM Proposal (with your timeline condition). Thanks for all your good work. -----Original Message----- From: =09Novosel, Sarah =20 Sent:=09Wednesday, September 05, 2001 7:30 PM To:=09Presto, Kevin M.; Shapiro, Richard; Steffes, James D.; Robertson, Lin= da; Fromer, Howard; Allegretti, Daniel; Hoatson, Tom Subject:=09RE: Support of PJM's Proposal to Implement Northeast RTO Kevin: I think the PJM proposal looks pretty good as a first step. As we discusse= d in Houston, the proposal gives us a single day-ahead and real time energy= market for the entire Northeast, but it does not get us everything at firs= t. For example, on Day One, PJM proposes to retain the 4 existing control = areas and allow the individual control areas to redispatch in the real time= market for local transmission constraints. This could result in New York = continuing to manipulate the market in an attempt to keep prices down, but = as we discussed in Houston (and as Andy Ott has confirmed), it is highly un= likely that PJM will allow New York to continue this type of market interfe= rence once PJM is in charge and running the market. Also, by leaving some = of the existing systems in place, PJM has aptly responded to the New York a= rgument that "local reliability" in New York must be maintained, so that Ne= w York's opposition is seen for what it is -- an attempt to delay indefinit= ely an RTO in the Northeast. Enron's support of the PJM proposal would be very helpful in mediation sinc= e we are seen as a big player in the region and because the other two propo= sals on the table are sponsored by the New York TOs and the New York ISO an= d envision a new RTO system based on the PJM "Platform" changed by as-yet u= ndefined "Best Practices" from the other two ISOs (and New York has indicat= ed it thinks a lot of its market design is a "best practice"), and these ot= her options will not begin operation for 3-5 years at best. Nevertheless, even though we here in Washington think the PJM proposal look= s good, it is important that you and your team are also comfortable with it= . If you all have not had an opportunity to review the proposal to ensure = that you are satisfied with it, then I would propose that we not sign Enron= 's name onto the proposal. We can talk about the proposal in more detail a= nd even have Andy Ott available for a conference call or a trip to Houston = to answer any questions you may have. If you need more time, then I think = we should follow this route instead, even if it means we cannot lend our su= pport for PJM at this time. Please let me know what you think. Sarah -----Original Message----- From: =09Presto, Kevin M. =20 Sent:=09Wednesday, September 05, 2001 7:41 PM To:=09Novosel, Sarah; Shapiro, Richard; Steffes, James D.; Robertson, Linda= ; Fromer, Howard; Allegretti, Daniel; Hoatson, Tom Subject:=09RE: Support of PJM's Proposal to Implement Northeast RTO Are we sure we can live with everything else in the PJM Single RTO proposal= ? -----Original Message----- From: =09Novosel, Sarah =20 Sent:=09Wednesday, September 05, 2001 6:36 PM To:=09Shapiro, Richard; Steffes, James D.; Robertson, Linda; Presto, Kevin = M.; Fromer, Howard; Allegretti, Daniel; Hoatson, Tom Subject:=09Support of PJM's Proposal to Implement Northeast RTO As I mentioned to each of you today, we plan to sign Enron's name as a memb= er of the "One RTO Coalition" in support of PJM's proposal for developing a= single Norhteast RTO with a single day-ahead and real-time energy market i= n the Northeast. PJM's proposal is attached. As you may recall, I gave yo= u a copy of PJM's proposal and we discussed it when I was in Houston a coup= le of weeks ago. The main concern with PJM's proposal is its timing -- the= ir time line provides for an implementation date of November 2003. We have= talked extensively with PJM about the need to speed up the implementation = process, and PJM agrees that they will move aggressively, but they are unwi= lling to change their target date in their proposal. Because we disagree with the PJM date, we propose to have Enron Power Marke= ting, Inc.'s name included on the list of supporters of the proposal, with = the following footnote: =09While all of the members of the One RTO Coalition support the substance = of PJM's proposal to implement a single energy market as described herein, = Enron =09Power Marketing, Inc. dissents from PJM's date of November 2003 fo= r implementing the single RTO in the Northeast. Enron believes that the PJ= M proposal =09can and must be implemented by December 2002 and that extensi= on of the implementation date past December 2002 is unnecessary and contrar= y to the =09Commission's RTO policy established in Order No. 2000. This footnote will preserve our right to argue against PJM's timing in comm= ents to the Commission after the Judge submits his report (due on September= 17). In those comments we can go into much greater detail about the need = for quick implementation. Please let me know if you have any suggested changes to the footnote or if = you disagree with our proposed strategy. We will address this issue on Thu= rsday at mediation (I thought it was going to come up today, which is why I= called each of you), so if you have any comments or concerns, please let m= e know as soon as possible.=20 Thanks Sarah =09 << File: PJM Market Design Proposal.pdf >>