Subject: Re: TW Cash for Fuel Issues
From: [email-masked]
To: [email-masked]
Cc: [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked], [email-masked]
Date: Thu, 22 Jun 2000 07:05:00 -0700 (PDT)

With regard to capacity release I think we will have to give the replacement 
shipper the cash-for-fuel option, because what if we have sold capacity that 
was created by the releasing shipper's buying fuel from us?  If the 
replacement shipper suddenly starts shipping fuel, that capacity goes away.  
(It's sort of like the EFBH/resulting forward haul problem).  Probably we 
should require that the cash for fuel election automatically transfer to the 
replacement shipper.  This would probably have to go into our tariff 
someplace when we make our FERC filing; otherwise it might run contrary to 
our current tariff provisions and practice.  Another solution might be to 
just sell resulting capacity as LFT, daily FTS-1 or even FTS-3 capacity (with 
some modifications to the FTS-3 Rate Schedule, of course), which would allow 
us the flexibility not to schedule on certain days.  For longer-term deals 
this might not be practicable, though.  

Further questions...let me know.

Ramona Betancourt
06/20/2000 02:04 PM
To: Christine Stokes/ET&S/Enron@ENRON, Jeffery Fawcett/ET&S/Enron@ENRON, 
Lorraine Lindberg/ET&S/Enron@ENRON
cc: Susan Scott/ET&S/Enron@ENRON, Mary Darveaux/ET&S/Enron@ENRON, Debbie 
Moseley/ET&S/Enron@ENRON, Sheila Nacey/ET&S/Enron@ENRON, Lynn 
Blair/ET&S/Enron@ENRON, Julia White/ET&S/Enron@ENRON, John 
Buchanan/ET&S/Enron@ENRON, Richard Hanagriff/ET&S/Enron@ENRON, Elizabeth 
Brown/ET&S/Enron@ENRON, David Duff/ET&S/Enron@ENRON, Gerry 
Medeles/ET&S/Enron@ENRON, Steven Harris/ET&S/Enron@ENRON 

Subject: TW Cash for Fuel Issues

Christine,

After our meeting last week, John, Elizabeth, Gerry, Richard, Dave & I 
discussed various options related to this cash for fuel process. We had 
several open issues that came up in our discussions and they are as follows:

Regulatory/Legal issue: Can we have contract specific language on our firm 
contracts that would prevent the firm shipper from releasing this fuel 
discount  cash option to an acquiring shipper?     If we must offer this 
special cash option to the acquiring shipper we will need to build a process 
to track this fuel option from the firm shipper to the releasing shipper. 
This will require more system modifications that we have not accounted for at 
this time.

Shipper nomination issue: How will we handle shipper nomination line items 
that are nominated as overrun paths on their firm contracts?  Could we 
default these "02" overrun transactions to calculate the fuel in kind using 
our existing tariff fuel %?  This would  make the process of trying to 
reconcile the contracted MDQ fuel volumes easier when we verify that the 
volumes the shipper elected to pay in cash tie back to the total volumes 
scheduled & paid for in cash..

Tariff Sheet issue:  When you state in the tariff provision that "The shipper 
may use the cash for fuel option only if the posted point of sale is a 
receipt point on shipper's service agreement" Does this only apply to the 
shipper's primary receipt points?

I would appreciate it if you could respond to these issues. If you feel like 
we should meet to discuss, I will be glad to set up another meeting. Please 
let me know.

Thanks Ramona