Message-ID: <29601069.1075852525288.JavaMail.evans@thyme> Date: Wed, 24 Oct 2001 07:59:51 -0700 (PDT) From: sarah.novosel@enron.com To: m..landwehr@enron.com, john.shelk@enron.com Subject: RE: RTO Week -- Summary of Standards and Practices Panel Cc: a..hueter@enron.com, linda.robertson@enron.com, sue.nord@enron.com, pat.shortridge@enron.com, richard.shapiro@enron.com, janel.guerrero@enron.com, d..steffes@enron.com Mime-Version: 1.0 Content-Type: text/plain; charset=ANSI_X3.4-1968 Content-Transfer-Encoding: quoted-printable Bcc: a..hueter@enron.com, linda.robertson@enron.com, sue.nord@enron.com, pat.shortridge@enron.com, richard.shapiro@enron.com, janel.guerrero@enron.com, d..steffes@enron.com X-From: Novosel, Sarah X-To: Landwehr, Susan M. , Shelk, John X-cc: Hueter, Barbara A. , Robertson, Linda , Nord, Sue , Shortridge, Pat , Shapiro, Richard , Guerrero, Janel , Steffes, James D. X-bcc: X-Folder: \JSTEFFE (Non-Privileged)\Steffes, James D.\Inbox X-Origin: Steffes-J X-FileName: JSTEFFE (Non-Privileged).pst If he filed comments at FERC, they should be on FERC's web system called RI= MS. I will ask Sam to look into this. =20 -----Original Message----- From: Landwehr, Susan M.=20 Sent: Tuesday, October 23, 2001 5:34 PM To: Shelk, John Cc: Hueter, Barbara A.; Robertson, Linda; Nord, Sue; Shortridge, Pat; Novos= el, Sarah; Shapiro, Richard; Guerrero, Janel; Steffes, James D. Subject: RE: RTO Week -- Summary of Standards and Practices Panel Not that I am aware of--it looked like he was talking off of notes, but I w= as sitting behind him and couldn't see very well. That's why I thought a t= ranscript might be a good idea....or if he did have a prepared statement th= at he submitted to FERC, would they post it on a web site? Question for Sa= rah? -----Original Message-----=20 From: Shelk, John=20 Sent: Tue 10/23/2001 4:17 PM=20 To: Landwehr, Susan M.=20 Cc: Hueter, Barbara A.; Robertson, Linda; Nord, Sue; Shortridge, Pat; Novos= el, Sarah; Shapiro, Richard; Guerrero, Janel; Steffes, James D.=20 Subject: RE: RTO Week -- Summary of Standards and Practices Panel Getting more information in this person and getting him to contact Congress= is very important. He is in the district of House Chief Deputy Whip Roy B= lunt (R-MO), who is Cong. DeLay's right-hand man in the leadership. He als= o serves on the Barton Subcommittee. While Linda, Pat and I had breakfast = with him next week, and he will be in Houston for next month, he and his st= aff stress that he is close to public power in his district, which includes= Springfield, MO. Did he have a prepared statement at the RTO Week hearing= ? -----Original Message----- From: Landwehr, Susan M.=20 Sent: Tuesday, October 23, 2001 5:12 PM To: Shelk, John Cc: Hueter, Barbara A.; Robertson, Linda; Nord, Sue; Shortridge, Pat; Novos= el, Sarah; Shapiro, Richard; Guerrero, Janel; Steffes, James D. Subject: FW: RTO Week -- Summary of Standards and Practices Panel John--this is the recap from Thursday afternoon of RTO week. Although Andy= did not focus on it in his report, there was an individual who sat on the = panel from Missouri that did a fantastic job of supporting FERC and market = postitions despite the fact that he is a public power guy. His name is Bil= l Burks and he is the Associate General Manager of the City Utilities of Sp= ringfield, Missouri. In his comments he stated that his utility was "whole= heartedly supporting FERC moving forward to push for on RTO" and then went = on to talk about how Missouri is going to continue to suffer from seams iss= ues if FERC doesn't stick to their guns on just a few major RTOs. =20 He stated that "flexible" standardization would not work and that the FERC = should put out a platform of standardized tariffs and if there was some uti= lity or group of stakeholders that thought they were special or unique or d= ifferent, then the burden of proff should be on them to petition FERC for a= n exemption, not the other way around. =20 =20 I'm thinking that this gentlemen would be an excellent choice for a committ= ee hearing if you have the opportunity to suggest folks to testify in the f= uture. IF you are able to get transcripts from RTO week, it might also be w= orth it to review his comments and pass them on as appropriate. =20 =20 =20 =20 -----Original Message-----=20 From: Rodriquez, Andy=20 Sent: Thu 10/18/2001 4:46 PM=20 To: Black, Tamara Jae; '/o=3DENRON/ou=3DNA/cn=3DRecipients/cn=3Dnotesaddr/c= n=3Da478079f-55e1f3b0-862566fa-612229'; Abler, William; Aggarwal, Anubhav; = Allen, Diana; Arora, Harry; Bailey, Debra; Ballato, Russell; Ballinger, Ted= ; Baughman Jr., Don; Benchluch, Moises; Benjelloun, Hicham; Benson, Robert;= Bentley, Corry; Blaine, Jay; Bolt, Laurel; Broderick, Paul J.; Broussard, = Richard; Burnett, Lisa; Campbell, Larry F.; Capasso, Joe; Carson, Mike; Che= n, Alan; Choate, Jason; Cline, Kevin; Collins, Dustin; Comeaux, Keith; Coul= ter, Kayne; Davis, Mark Dana; Day, Smith L.; Dean, Clint; Decook, Todd; Eme= sih, Gerald; Errigo, Joe; Forney, John M.; Freije, William; Garcia, Miguel = L.; Gilbert, Gerald; Gilbert-smith, Doug; Giron, Gustavo; Greer, Andrew; Gu= aly, Jaime; Guerra, Claudia; Gulmeden, Utku; Gupta, Gautam; Ha, Amie; Hanse= , Patrick; Hernandez, Juan; Imai, Rika; Ingram, David; Jenkins IV, Daniel; = Kaniss, Jason; King, Jeff; Kinser, John; Larkworthy, Carrie; Laurent, Dean;= Laverell, Justin; Lenartowicz, Chris; Lorenz, Matt; Lotz, Gretchen; Lowell= , Thomas; Mack, Iris; Mahajan, Ashish; Makkai, Peter; Marquez, Mauricio; Ma= skell, David; May, Tom; McElreath, Alexander; Miller, Jeffrey; Oh, Seung-Ta= ek; Olinde Jr., Steve; Pace, Andy; Padron, Juan; Pan, Steve; Philip, Willis= ; Podurgiel, Laura; Poppa, John D.; Presto, Kevin M.; Quenet, Joe; Rawal, P= unit; Rogers, Benjamin; Rust, Bill; Ryan, David; Saibi, Eric; Schiavone, Pa= ul; Schneider, Bryce; Seely, Michael; Serio, Erik; Shoemake, Lisa; Simpson,= Erik; Stalford, Robert; Stepenovitch, Joe; Sturm, Fletcher J.; Symms, Mark= ; Tamma, Ramanarao; Thomas, Paul D.; Trejo, Reese; Valdes, Maria; Vernon, C= layton; Wang, Steve; Williams, Ryan; Willis, Cory; Zipperer, Mike; Baughman= , Edward D.; Clynes, Terri; Dalton III, Oscar; Kelly, Mike E.; Sewell, Doug= ; Valderrama, Larry; Walton, Steve; Roan, Michael; Perrino, Dave; Maurer, L= uiz; Hueter, Barbara A.; Landwehr, Susan M.; Hoatson, Tom; Novosel, Sarah; = Nicolay, Christi L.; Yeung, Charles=20 Cc:=20 Subject: RE: RTO Week -- Summary of Standards and Practices Panel RTO Week =20 Day 4 - October 18, 2001 Afternoon Session =20 Standardizing Markets, Business, and Other Practices=20 Panelists for this discussion were: Sarah Barpoulis, PG&E National Energy = Group; William P. Boswell, GISB; Bill Burkes (substituting for David J. Chr= istiano), City Utilities of Springfield, Missouri; David N. Cook, NERC Gene= ral Counsel; Michael Kormos PJM Interconnection; LeRoy Koppendrayer, Minnes= ota Public Utilities Commission; and Marty Mennes, Florida Power & Light Co= mpany. =20 General Observations =20 The Commissioners were all present the majority of the time (Massey left la= te in the afternoon). FERC Staff was active in the discussion; however, t= he commissioners were very active as well, asking perhaps as much as 70% of= all questions. There was a general consensus that standards were needed; = much discussion focused simply on how much and by who. The Commission seeme= d very interested in leaning what they needed to do to move the industry fo= rward and how far they needed to go. Panelists urged the need to mover for= ward as quickly as possible, but both they and FERC seemed to recognize tha= t some of the issues regarding standardized market design and such needed t= o be addressed before RTOs could really begin to move forward. There was d= iscussion on identifying which industry group (NERC or GISB) would take the= reins in the future. On an interesting tangential note, there was noticea= ble conflict between NERC and GISB, with veiled insults between the two org= anizations somewhat common during the discussions.=20 =20 FERC Deliverables A great deal of the discussions focused on identifying what the industry ne= eded from the Commission. Staffers probed all panelists to find what they = felt was critical. =20 The first major topic was "How many RTOs? What is their scope?" All panel= ists seemed to agree that this question needed to be answered immediately b= y FERC, in strong definitive language. N o one offered any specific langua= ge, but seemed to be urging FERC to issue a formal statement. The next topic was, "What will be standard market design?" Panelists varie= d on this, but most felt strong guidance from FERC is urgent. Some urged f= or one mandatory design for North America, one supported a set of rigid sta= ndard designs, one supported a single design with requests for exceptions (= followed by an in-depth review process), and one seemed to prefer the curre= nt situation. The commission in general seemed to be very interested in understanding wha= t the industry needed to move forward. They continually visited this topic= throughout their discussions, asking questions like, "Do we need to issue = a Mega-Order that addresses all these issues?" and, "How much detail do you= need us to provide?" General feel from the panelsists seemed to be they = wanted strong leadership in this areas. Kormos and Burkes went so far as t= o say FERC should "Mandate as much as they felt comfortable - and then go a= little further." Others seemed to be a little worried about this idea, bu= t in general did not oppose the concept, citing only general warnings and t= he need for cautious investigation. =20 One item of interest: Wood referred to the filing made by the Electronic Sc= heduling Collaborative and specifically asked if the items identified in th= e "RTO Design and RTO Implementation" section would address many of the que= stions and uncertainty facing the industry with regard to RTO design. Korm= os indicated that clear and specific answers to these questions specifying = a course of action would go a long way toward guiding the industry. The se= ction to which Wood referred was one that I wrote, and asked the following = questions: ? Congestion Management - When Operational Security Violations occu= r, how is the system to be stabilized in a fair and equitable manner that i= s nonetheless efficient? Will LMP based systems be standard, or will there= be others that must be accommodated? ? Transmission Service - Are transmission services required to sch= edule ("covered" schedules only), or are they risk management tools protect= ing from congestion charges (both "covered" and "uncovered" schedules are a= llowed)?=20 ? Loop Flows - Are contract-path based or flow-based transmission = services appropriate? If contract-path based, how are parallel path issues= to be addressed? ? Grandfathered Transmission Service - Should contracts existing pr= ior to RTO development be transferred, or is there an equitable way to reti= re those contracts? Are there other solutions? ? Energy Imbalance Markets - How are imbalance markets to function?= Will they serve as real-time energy markets (support unbalanced schedules)= , be limited to supplying needs of imbalance service (require balanced sche= dules), or will they be required at all? ? Ancillary Services - Will ancillary service markets be developed = in standard ways? Will entities be required to actually schedule ancillary= services (required to schedule), or will they be treated primarily as fina= ncial instruments (protecting against real-time POLR charges)? ? Losses - Can we utilize the imbalance markets to support losses? = Can we create specific loss standards that facilitate the scheduling proce= ss, or must we support methods that are currently in tariffs, but technical= ly unwieldy? ? Non-Jurisdictionals - How are non-jurisdictionals to be integrate= d into the new world? Should systems be designed with the assumption that = non-jurisdictional will be part of an RTO? Or should they be designed to t= reat each NJE as a separate entity? Hopefully, FERC will use this section as a template to answer these critica= l questions in an assertive manner, and give some solid direction in which = to move. Kormos emphasized the need for concrete answers to these questions= , pointing out that vague answers (i.e., "do congestion management") will t= ake a year or two to resolve, but specific answers (i.e., "LMP with financi= al hedging instruments") will take only months. The Commission asked Mike = about moving forward, and he told them that effectively, it was impossible = to move forward with implementation without getting these issues addressed. Now for a funny point - One of the commissioners (I think Breathitt) refer= red to some concerns expressed in the Northwest that their high concentrati= on of hydro power makes LMP inefficient for the Northwest. Kormos flat out= said, "My profession is understanding how power systems work, and I don't = believe that that statement is true." He then backpedaled a bit and said t= hat it would need more study, but he stood by his statement that the assert= ion by the Northwest interests was false. NERC and GISB A great deal of discussion focused around the need for a single standard-se= tting organization. Massey went so far as to ask, "Are we looking at a bea= uty contest between NERC and GISB?" Cook and Boswell then went into severa= l short polite jabs at each other's organizations. Other participants cont= inually reiterated the need for ONE, INDEPENDENT organization. Interesting= ly, Boswell was very emphatic about the established trust and respect in GI= SB, while Cook preferred to only talk about the "new" structure of NERC and= did not focus on its history. Brownell offered some not-too-subtle passive support of GISB by pointedly a= sking both Cook and Boswell if they lobbied political positions (i.e., were= they not only an organization but also a stakeholder?). GISB was easily a= ble to say they were not, but NERC of course had to admit to their romancin= g of Congress and the Bush administration for reliability legislation. Poin= t, Brownell. Mennes acted as somewhat of a supporter for NERC, playing Dave Cook's yes-m= an. He probably did them a little bit of harm by pointing to NERC's suppos= ed "successes," such as TLR and E-Tag. If staffers have tenure, they will = likely remember that these "successes" have not been so successful, resulti= ng in several filings and interventions. We may also wish to file comments= in specific objection to these claims, to refresh their memory and to show= the pretty picture Marty painted was in fact a fiction. There was a little discussion about splitting reliability and market issues= , but general consensus was that I could not be done. There was also some = talk of folding NERC under GISB/EISB. The arguments began winding down after a some time, and Boswell strongly ur= ged the Commission to speak to industry executives and advocacy group leade= rship to see whether NERC or GISB should lead the industry forward. NERC s= omewhat less enthusiastically supported this position. In general, I would= say it was a close fight but GISB came out more on top. Let me know if you have any questions. Andy Rodriquez Regulatory Affairs - Enron Corp. andy.rodriquez@enron.com 713-345-3771=20