Message-ID: <15943721.1075862241614.JavaMail.evans@thyme> Date: Fri, 12 Oct 2001 14:14:24 -0700 (PDT) From: sarah.novosel@enron.com To: richard.shapiro@enron.com Subject: Northeast RTO Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Novosel, Sarah X-To: Shapiro, Richard X-cc: X-bcc: X-Folder: \RSHAPIRO (Non-Privileged)\Shapiro, Richard\Deleted Items X-Origin: Shapiro-R X-FileName: RSHAPIRO (Non-Privileged).pst I spoke with Craig Glazer (PJM Wash Rep) yesterday afternoon regarding the status of the northeast RTO efforts. As you may recall, we, along with many other market participants and PJM, advocated a Board makeup for the new Northeast RTO board of 5 PJM Board members, 3 NY board members, and 2 NE board members. New York and New England are pushing hard for parity - 3 from each board. PJM is concerned that FERC is going to take the political way out and go with parity. Our concern with this approach has always been that if all three ISOs are equally represented, progress will not be made in forming the new RTO because the other two ISO board members will retain their bias and preferences for their own ISO sturucture, and development of the northeast RTO will be delayed indefinately. These three ISOs have been working on the seams issues, through the MOU process, for the past 2 years and absolutely nothing happened -- no progress was made. FERC recognized this in its July 12 order on mediation. If FERC does take the political route and order parity on board makeup, then it is imperative that FERC issue a clear, unambiguous order directing that the PJM system be implemented, that not many changes are made to the PJM platform (in the form of "best practices" from other ISOs), and that the new Board members' fiduciary duty must be to the new RTO. If they go this route, we would also want FERC to require that PJM management and staff be the Project Leader in seeing that the new RTO gets up and running. Other issues of concern are: California Audit See ISO report and generators response (generators' response is attached -- faxed ISO's report) Congestion Management Preference for ERCOT system? Preference for PJM type system? Types of cost/benefits analysis that would be helpful Would a Mirant study in the midwest be helpful? One in the southeast? One for the entire country showing general benefits of regionalization? Talk to you soon. Sarah