Message-ID: <7887219.1075852528448.JavaMail.evans@thyme> Date: Mon, 25 Jun 2001 14:47:00 -0700 (PDT) From: steve.walton@enron.com To: james.steffes@enron.com Subject: Re: TOP 10 ISSUES TO DISCUSS FOR WHOLESALE MARKETS Mime-Version: 1.0 Content-Type: text/plain; charset=us-ascii Content-Transfer-Encoding: 7bit X-From: Steve Walton X-To: James D Steffes X-cc: X-bcc: X-Folder: \JSTEFFE (Non-Privileged)\Steffes, James D.\Top 10 Issues 6/1/01 X-Origin: Steffes-J X-FileName: JSTEFFE (Non-Privileged).pst Jim, Sorry to be late. I could only come up with a top seven. Strategy for FERC Advocacy. What are the potential risks of a Standard Model versus the delay in waiting for slowly developing Regional Proposals? Congestion Management. Depends on outcome of above discussion. Do we continue to work on proposals not conforming to the Standard Model? Definition of Long Term Transmission Property Right, (be that financial or physical). This is the key to expansion; any party building or funding new transmission needs to have certainty regarding what they acquire for their investment. Do we order transmission owners to build for revenue requirement and then just auction off rights once built? This is really the old monopoly model. Is it possible/preferable to use an open-season model for major expansion products between market hubs? Allocation/Auction of FTRs. The existing systems are heavily committed so little will be left to auction under most allocation schemes. Often the existing claims have to be prorated. The Grid Florida order seems to validate allocation proposals. What is our position? Secondary Markets for Transmission Rights. The lack of secondary liquidity in PJM-FTR and NY-TCCs goes much deeper than just the allocation of the rights. What changes are needed to move the market? Would a change in information availability (price and physics) change the market? Does the definition right need to be modified? RTO Governance Model. The paramount need is independence from energy market, which goes beyond the nature of the board to the depth of involvement in the market. There is always some one pushing things like long run acquisition of ancillary services, which then gives the RTO a position in the energy market and its role as operator is biased to protect is position. The California experience is instructive as the ISO has begun to see its duty of controlling prices instead of a duty to impartially operate the system. Transition to RTO-World. NERC activities seem to continue to be focused on the ATC/TLR approach while the RTOs are moving to congestion management systems in which ATC something of a anachronism. Is this the time for NERC to be writing a entire new set of standards to meet the needs of a passing paradigm. Steve James D Steffes@ENRON 06/22/2001 08:19 PM To: Thane Twiggs/Enron@EnronXGate, Ron McNamara/NA/Enron@Enron, Tom Hoatson/NA/Enron@Enron, Dan Staines/HOU/ECT@ECT, Susan M Scott/Enron@EnronXGate, Charles Yeung/HOU/ECT@ECT, Joe Connor/NA/Enron@Enron, Daniel Allegretti/NA/Enron@Enron, Howard Fromer/NA/Enron@Enron, Mike Roan/ENRON@enronXgate, Christi L Nicolay/HOU/ECT@ECT, Susan J Mara/NA/Enron, Alan Comnes/Enron@EnronXGate, Steve Walton/HOU/ECT@ECT cc: Subject: TOP 10 ISSUES TO DISCUSS FOR WHOLESALE MARKETS Please send me as soon as possible your Top 10 Issues we need to discuss on wholesale markets (as discussed in Colorado). Jim [IF ALREADY DONE, SORRY]